South Korea Regulator Expands Mirae Asset Review After Brokerage Receives No SpaceX Shares

South Korea’s Financial Supervisory Service has expanded an inspection of Mirae Asset Securities Co. to examine the brokerage’s failure to secure an allocation of SpaceX shares in the company’s initial public offering. The watchdog had already begun reviewing the firm last week to check whether investors who signed up met eligibility requirements for registered professional investors.

It widened the scope after Mirae Asset accepted deposits yet received no shares, according to people familiar with the matter. Mirae Asset Securities was one of the underwriters for the SpaceX IPO. The brokerage offered access to the shares through a private placement to clients registered as professional investors.

Retail investors in South Korea were shut out of the offering. Demand for the placement was intense. The first $300 million tranche sold out in one minute, with a minimum investment of $100,000 and a maximum cap of $3 million per investor, Yonhap Infomax reported.

Mirae Asset had planned to open subscriptions for a second $200 million tranche on June 8. Mirae Asset Securities declined to comment on the inspection and the allocation failure. 2 percent.

The Korea Times reported on Sunday that regulators were planning to examine the circumstances surrounding the missed allocation. Under South Korea’s capital markets act, an offering is generally considered private if subscription solicitations are made to fewer than 50 investors.

Offerings limited to qualified professional investors can be exempted from public-offering rules even when solicited to 50 or more investors.