Sajodongaone Co.,Ltd. (KOSE:A008040) agreed to acquire Korea Dongah Flour Mills Co. Ltd. from Sajo Seafood Co., Ltd. (KOSE:A014710) and others for approximately KRW 130 billion on May 30, 2017. Under the terms of the transaction, Sajodongaone Co.,Ltd. will issue 75.9 million shares for the merger and the merger ratio is 1:6.7581379 and will acquire 26.7% stake from Sajodaerim Corporation (KOSE:A003960) and SAJOHAEPYO Corporation (KOSE:A079660) each, 35.6% from Sajo Seafood Co., Ltd. and 10.7% from Jihong Joo.

Post-acquisition, Sajodongaone Co.,Ltd. will be the surviving company and Korea Dongah Flour Mills Co. Ltd. will be the absorbed company. For the year ended December 31, 2016, Korea Dongah Flour Mills Co.

Ltd. reported total revenues of KRW 150.65 billion, total assets of KRW 239.88 billion and net income of KRW 16.56 billion. As a result of the merger, there are no directors or members of the audit committee who will take office in Sajodongaone Co.,Ltd., and the directors and auditors of Sajodongaone Co.,Ltd. that took office before the merger will continue their positions throughout the remaining term unless there is a specific reason for resignation. As of May 30, 2017, Board of Sajodongaone Co.,Ltd. resolved the transaction.

As of July 27, 2017, the transaction was approved by the shareholders of Sajodongaone Co.,Ltd. The transaction is expected to complete on August 31, 2017. BDO Daejoo LLC acted as external rating institution in the transaction.