Naver-Dunamu merger faces shareholder eligibility hurdle

The proposed merger between Naver Financial and Dunamu has hit a snag over major shareholder eligibility requirements, the Korea Economic Daily reported. An amendment to South Korea's financial transaction law, set to take effect on Aug. 20, will disqualify major shareholders and executives of virtual asset service providers if they have a history of fines or more severe penalties under regulations such as the Fair Trade Act. Naver Financial and Dunamu, which filed for merger approval with the Fair Trade Commission (FTC) late last November, have postponed an extraordinary shareholders' meeting for their stock swap from May 22 to Aug. 18, just before the new law is implemented. The delay comes as the FTC's review continues. In addition to the FTC's approval, the deal is subject to a separate eligibility review by financial authorities. Naver's 200 million won fine for a Fair Trade Act violation last September is expected to be a potential obstacle in this process.