[COVER STORY] Ownership battle over Korean Air fuels stock premium, volatility

Hoban Group is facing a strategic dilemma over its next move in its ongoing ownership battle with Hanjin Group Chairman Cho Won-tae, as sharp swings in Hanjin KAL’s stock make it increasingly costly for either side to keep buying shares to maintain the top shareholder position. Hoban became Hanjin KAL’s largest shareholder on Nov. 4 after increasing its stake to 20.69 percent, narrowly overtaking the 20.58 percent held by Cho and his affiliates. The shift followed a surge in Hanjin KAL shares. The stock has since become even more volatile. It hit a record high of 245,000 won on Tuesday before plunging to an intraday low of 185,000 won on Thursday and closing at 203,500 won on Friday. The sharp swings have added to the financial burden on both sides as they continue to accumulate shares in their battle for control. Hoban has three possible options for its next move. The first is to sell its stake through a block deal. Hoban could negotiate with Cho around next year's annual shareholders meeting over whether to halt further purchases and participate in Hanjin KAL's board. If an agreement