SOUTH KOREA — The Korea Exchange announced a plan on June 11, 2025, to prohibit parent-subsidiary listings as a general principle. Jeong Eun-bo, CEO of the Korea Exchange, stated that "Parent-subsidiary listings, which refer to a unit pursuing its own listing, will be prohibited as a general principle." This move forms part of broader corporate governance reforms in South Korea.

In the year to June 3, South Korea recorded 15 new equity listings, with proceeds totaling approximately $700 million. This contrasts with an average of 80 new equity listings per year and around $8 billion in annual proceeds between 2020 and 2025. The Kospi index more than doubled in value in the year leading up to the Monday prior to June 11.

South Korea launched the "Corporate value-up initiative" in 2024 and enacted three rounds of amendments to the Commercial Act to improve minority shareholder protection and corporate governance. The Korea Exchange plans to delist approximately 300 companies by next year. As of the Monday prior to June 11, five major conglomerates—Samsung, SK, Hyundai Motor, LG, and HD Hyundai—accounted for around 70% of South Korea's equity market capitalization. Cross-held shares between listed companies represented about 11% of South Korea's total market capitalization last year.

Polka Mishra, a partner at Javelin Wealth Management, stated that chaebols, which were once central to South Korea's industrial development, are now "more of a hindrance than a help for creating new, independently listed champions." Mishra added that "South Korea's inheritance tax of 50% for amounts exceeding 3 billion won ($2 million) gives conglomerates an incentive to keep valuations and free float low." Lee Hyo-seob, a senior research fellow at the Korea Capital Market Institute, said that "While fewer parent-subsidiary listings have raised parent companies' valuations, the slowdown has dampened the fundraising and exit environment for venture capital funds." The National Growth Fund invested approximately $130 million in the AI chip startup Rebellions and a similar amount in FuriosaAI.

Jeong Eun-bo expressed expectation that companies would proceed more actively with their listing processes once the government issues clearer guidelines on parent-subsidiary listings, stating, "Once the government issues clearer guidelines on parent-subsidiary listings, I expect companies to move forward more actively with their listing processes."