SpaceX IPO ‘Zero Shares’ Leaves Korean Asset Managers Scrambling

Mirae Asset Securities Fails to Secure Allocation for Local Underwriting Group

Korea Investment, Mirae ETF Inclusion Plans Unravel

South Korean asset managers’ plans to secure SpaceX IPO shares in advance have fallen apart. Mirae Asset Securities, part of the local underwriting group, failed to obtain any shares from the lead underwriter, leaving asset managers that subscribed through the brokerage without an IPO allocation.

According to the financial investment industry on June 13, Korea Investment Trust Management and Mirae Asset Global Investments had planned to secure SpaceX shares through the offering and add them to their exchange-traded funds.

Korea Investment Trust Management had previously disclosed its plan to participate in the SpaceX IPO. It intended to split any allocated shares between the ACE U.S. Space Tech Active ETF and the Korea Investment Global Space Technology & Defense Fund. On June 8, the firm said individual investors’ net purchases of the ETF over the past month had exceeded 60 billion won ($43.5 million).

Mirae Asset Global Investments had also planned to participate in the IPO through products including the TIGER Global AI Active ETF and the TIGER Global AI Power Infrastructure Active ETF. It ultimately received no shares. Both firms submitted subscription orders through Mirae Asset Securities, but the brokerage failed to secure an allocation.

Korea Investment Trust Management posted a notice on its website on the morning of June 12 saying it had received an allocation and would soon disclose the exact amount. Later that afternoon, it issued another notice saying the disclosure schedule had been delayed because of confidentiality rules requested by the underwriter.

The final result, however, was no allocation. Korea Investment Trust Management said it was informed early on June 13 during the final allocation process that the lead underwriter for the SpaceX IPO had not assigned any sellable shares to the local underwriting group. The firm said it needed to notify investors immediately.

It added that the outcome reflected the particular characteristics and volatility of the US IPO market. The firm also apologized, saying it understood investors had high expectations for the inclusion of SpaceX IPO shares.

Korea Investment Trust Management said it failed to secure IPO shares but bought some SpaceX stock through intraday trading on the first day of listing and added it to its portfolio. Mirae Asset Global Investments plans to add SpaceX shares to passive ETFs starting two days after the listing. TIMEFOLIO Asset Management also planned to add the stock to its TIME Global Space Tech & Defense Active fund through market trading on the listing day.

Shin Hyun-bo, Hankyung.com reporter greaterfool@hankyung.com