Socar going public on Aug. 22 at a lower-than-hoped-for price

Socar will go public on Aug. 22 at a price lower than hoped for due to weaker-than-expected demand from institutions. The company will sell 3.64 million shares at 28,000 won ($21) a share, 17 percent cheaper than the lower end of the ..

Socar CEO Jake Park talks about the company's goals during a press conference on Aug. 3 at the Conrad Seoul in southern Seoul. [SOCAR]

Socar will go public on Aug. 22 at a price lower than hoped for due to weaker-than-expected demand from institutions.

The company will sell 3.64 million shares at 28,000 won ($21) a share, 17 percent cheaper than the lower end of the 34,000-won to 45,000-won price band it had filed for. The number of shares being offered is down 20 percent from the total announced earlier this month.

Socar will be selling 101.9 billion won of shares, 50 percent less than the 204.8 billion won that could have been reached if the initial plan had been met.

The company, which will be the first car-sharing enterprise to go public in Korea, received discouraging responses from institutions during the two-day book-building period on Monday and Tuesday.

"We have heeded the voices of investors and have finalized the structure in the most investor-friendly manner possible," said CEO Jake Park in a press release. "We thank the investors who took an interest in Socar's initial public offering and ask for investor support in the subscription that beings Aug. 10."

The public subscription period is Wednesday and Thursday. Twenty-five percent of the shares, or 910,000, will be offered.

Sixty percent of the raised funds will be put toward mergers and acquisitions while 20 percent will go toward expanding business, Park said during a press conference held earlier this month. The remainder will go toward the development of new technology.

Established in 2011, Socar first started its car-sharing service in Jeju with only 100 vehicles and some 30 users. The number of cars it operates is now in the 18,000s, with its users soaring to 7 million. It now dominates the market with an 80 percent share, the company said.

The company's pared-back listing comes as other companies choose to forgo the IPO process altogether in the face of rising interest rates and investor skepticism.

BY YOON SO-YEON [yoon.soyeon@joongang.co.kr]