-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PpW8eMNuLVrjDdl7tF2ItfbL+4KZkDPh2RwZc8OreeR3Hi9JS6sXu8G4tKUPH7Mt DdyjRsD3YFV2d1CplvWQxA== 0000088053-04-000981.txt : 20041124 0000088053-04-000981.hdr.sgml : 20041124 20041124135059 ACCESSION NUMBER: 0000088053-04-000981 CONFORMED SUBMISSION TYPE: N-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040930 FILED AS OF DATE: 20041124 DATE AS OF CHANGE: 20041124 EFFECTIVENESS DATE: 20041124 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KOREA FUND INC CENTRAL INDEX KEY: 0000748691 IRS NUMBER: 133226146 STATE OF INCORPORATION: MD FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: N-Q SEC ACT: 1940 Act SEC FILE NUMBER: 811-04058 FILM NUMBER: 041166454 BUSINESS ADDRESS: STREET 1: 345 PARK AVE STREET 2: C/O DEUTSCHE ASSET MANAGEMENT CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 617-295-3986 MAIL ADDRESS: STREET 1: DEUTSCHE ASSET MANAGEMENT STREET 2: TWO INTERNATIONAL FUND CITY: BOSTON STATE: MA ZIP: 02110 N-Q 1 nq093004kor.txt N-Q FILING UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY ------------------------------- Investment Company Act file number 811-4058 Korea Fund, Inc. ---------------- (Exact name of registrant as specified in charter) 345 Park Avenue New York, NY 10154 ------------------ (Address of principal executive offices) (Zip code) Salvatore Schiavone Two International Place Boston, Massachusetts 02110 --------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: (617) 295-2663 -------------- Date of fiscal year end: 06/30 ----- Date of reporting period: 9/30/04 --------- Form N-Q is to be used by registered management investment companies, other than small business investment companies registered on Form N-5 (ss.ss. 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-4). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507. ITEM 1. SCHEDULE OF INVESTMENTS The Korea Fund, Inc. Investment Portfolio as of September 30, 2004 (Unaudited)
- ---------------------------------------------------------------------------------------------------------------------------------- Shares Value ($) --------------------------------------------- Common Stocks 84.6% Consumer Discretionary 15.1% Auto Components 4.6% Halla Climate Control Corp. 600,000 5,419,019 Hankook Tire Co., Ltd. 4,464,307 40,126,424 ---------- 45,545,443 Automobiles 4.3% Hanil E-Wha Co., Ltd. 706,950 724,447 Hyundai Motor Co. (GDR) (Preferred) 144A 3,020,000 35,787,000 Nexen Tire Corp. 400,000 5,419,019 ---------- 41,930,466 Hotels Restaurants & Leisure 2.0% Hotel Shilla Co., Ltd. 858,391 4,211,819 Kangwon Land, Inc. 1,471,530 15,846,263 ---------- 20,058,082 Internet & Catalog Retail 0.2% LG Home Shopping, Inc. 56,200 2,169,422 Media 0.7% Cheil Communications, Inc. 57,600 7,428,224 Multiline Retail 3.1% Shinsegae Co., Ltd. 80,003 21,294,763 Taegu Department Store Co., Ltd. (b) 1,286,110 8,890,521 ---------- 30,185,284 Textiles, Apparel & Luxury Goods 0.2% BYC Co., Ltd. (b) 39,530 1,586,006 Consumer Staples 5.1% Beverages 1.6% Hite Brewery Co., Ltd. 50,000 3,673,469 Nam Yang Dairy Products Co., Ltd. (b) 43,390 11,568,155 ---------- 15,241,624 Food Products 1.4% CJ Corp. 99,606 5,363,067 Nhong Shim Co., Ltd. 38,229 8,167,029 ---------- 13,530,096 Household Products 0.1% LG Household & Health Care Ltd. 51,511 1,377,802 Tobacco 2.0% KT&G Corp. (GDR) 144A 413,800 5,458,022 KT&G Corp. 552,570 14,612,033 ---------- 20,070,055 Energy 8.1% Oil & Gas S-Oil Corp. 827,300 41,095,580 SK Corp. 826,200 38,099,193 ---------- 79,194,773 Financials 12.0% Banks 4.2% Jeonbuk Bank (b) 2,706,500 9,342,890 Kookmin Bank (ADR)* 100,917 3,213,197 Kookmin Bank* 909,198 28,780,084 ---------- 41,336,171 Diversified Financial Services 0.7% Dongwon Financial Holding Co., Ltd. 2 12 Nong Shim Holdings Co., Ltd. 22,521 1,198,903 Samsung Securities Co., Ltd. 164,720 2,796,592 Telephus Co., Ltd.* (b)(c)(d) 2,266,667 2,952,671 ---------- 6,948,178 Insurance 7.1% Korean Reinsurance Co. 1,643,310 5,637,060 Oriental Fire & Marine Insurance Co. (b) 584,860 7,872,627 Samsung Fire & Marine Insurance Co., Ltd. 979,625 56,403,941 ---------- 69,913,628 Health Care 0.5% Biotechnology 0.1% LG Life Sciences Ltd. * 14,825 419,065 Pharmaceuticals 0.4% Choongwae Pharma Corp. 88,600 1,023,344 Yuhan Corp. 46,500 3,069,040 ---------- 4,092,384 Industrials 6.4% Commercial Services & Supplies 2.1% Insun ENT Co., Ltd. 193,000 3,427,573 S1 Corp. 564,270 17,053,057 ---------- 20,480,630 Construction & Engineering 0.2% Ssangyong Engineering & Construction Co., Ltd.* 234,301 1,521,990 Industrial Conglomerates 2.5% Anycell, Inc. (b)(c)(d)(h) 1,250,000 0 Daeyang E&C Ltd.* 1,153,948 4,259,035 Hyundai Mobis 350,480 17,653,357 SFA Engineering Corp. 276,800 2,980,738 ---------- 24,893,130 Machinery 0.4% HS R&A Co., Ltd. 144,800 670,242 Samsung Climate Control Co., Ltd. (b) 827,630 3,622,454 ---------- 4,292,696 Trading Companies & Distributors 0.8% Jahwa Electronics Co., Ltd. 779,900 7,754,976 Transportation Infrastructure 0.4% Korea Express Co., Ltd.* 301,880 3,696,490 Information Technology 22.0% Computers & Peripherals 0.1% Ahnlab, Inc.* 89,600 1,023,222 Electronic Equipment & Instruments 5.2% Dae Duck Electronics Co., Ltd. 360,901 2,808,227 Hankuk Electric Glass Co., Ltd. 142,400 5,880,261 Interflex Co., Ltd. 178,700 3,724,533 Mtekvision Co., Ltd.* 83,200 2,127,868 Samsung Electro-Mechanics Co., Ltd.* 548,525 14,052,529 Samsung SDI Co., Ltd. 209,956 20,694,751 SE Co., Ltd.(b)(c)(d) 636,950 1,736,885 ---------- 51,025,054 Internet Software & Services 1.6% Daum Communications Corp.* 379,200 9,978,080 NCsoft Corp.* 70,000 5,756,839 ---------- 15,734,919 Semiconductors & Semiconductor Equipment 15.1% NEPES Corp.* 353,900 2,667,696 Samsung Electronics Co., Ltd. (i) 340,299 135,351,231 Seoul Semiconductor Co., Ltd. (b) 1,003,900 10,461,832 ----------- 148,480,759 Materials 10.3% Chemicals 1.4% Korea Fine Chemical Co. 21,233 194,536 LG Chemical Ltd. 212,486 8,063,950 Samsung Fine Chemicals Co., Ltd. 425,000 5,720,799 ----------- 13,979,285 Containers & Packaging 0.2% Youlchon Chemical Co., Ltd. 351,300 2,227,086 Metals & Mining 8.7% Dongkuk Steel Mill Co., Ltd. 1,170,900 12,608,910 Korea Iron & Steel Co., Ltd. 227,200 3,946,157 POSCO 443,000 65,978,724 Samwoo EMC Co., Ltd. (b) 754,800 1,864,877 SeAH Steel Corp. 77,110 1,094,875 ----------- 85,493,543 Telecommunication Services 5.1% Wireless Telecommunication Services SK Telecom Co., Ltd. 329,990 50,293,743 ----------- Total Common Stocks (Cost $361,147,478) 831,924,226 Principal Amount (f) Value ($) ---------- --------- Convertible Bond 0.4% Consumer Staples 0.0% Haitai Confectionery Loan Certificates, Zero Coupon, 11/28/2009 (c)(e)(f) 15,820,881 12,444 Financials 0.4% LG Card Co., Ltd., 3.0%, 2/12/2009 6,000,000,000 3,644,811 ----------- Total Convertible Bond (Cost $2,586,386) 3,657,255 Shares Value ($) ------ --------- Preferred Stocks 12.5% Consumer Discretionary 3.4% Automobiles 2.0% Hyundai Motor Co. (2nd) 738,593 19,114,261 Hotels Restaurants & Leisure 0.0% Hotel Shilla Co., Ltd. 32,070 128,670 Multiline Retail 1.4% Shinsegae Co., Ltd. 55,784 14,145,834 Consumer Staples 1.2% Beverages 0.0% Nam Yang Dairy Products Co., Ltd. 1,160 93,284 Food Products 1.1% CJ Corp. 297,200 7,897,803 CJ Corp. (2nd) 50,335 2,113,501 CJ Corp. (3rd) 30,201 1,131,718 ---------- 11,143,022 Household Products 0.1% LG Household & Health Care Ltd. 46,788 788,265 Energy 0.4% Oil & Gas S-Oil Corp. 156,040 4,295,673 Financials 1.4% Insurance Samsung Fire & Marine Insurance Co., Ltd. 533,850 13,769,297 Information Technology 5.6% Electronic Equipment & Instruments 0.3% Samsung Electro-Mechanics Co., Ltd.* 96,800 1,277,777 Samsung SDI Co., Ltd. 34,318 2,020,634 ---------- 3,298,411 Semiconductors & Semiconductor Equipment 5.3% Samsung Electronics Co., Ltd. (i) 198,201 51,895,442 Materials 0.5% Chemicals LG Chemical Ltd. 193,003 4,408,145 ----------- Total Preferred Stocks (Cost $28,521,604) 123,080,304 Investment Fund 0.1% Financials Hankang Restructuring Fund (c)(g) (Cost $2,065,316) 1,724,310 1,340,215 Cash Equivalents 0.4% Scudder Cash Management QP Trust 1.70% (a) (Cost $3,980,474) 3,980,474 3,980,474 ----------- % of Net Assets Value ($) ---------- --------- Total Investment Portfolio (Cost $398,301,258) 98.0 963,982,474 Other Assets and Liabilities, Net 2.0 20,032,459 ----------- Net Assets 100.0 984,014,933 ===========
For information on the Fund's policies regarding the valuation of investments and other significant accounting policies, please refer to the Fund's most recent semi-annual or annual financial statements. * Non-income producing security. (a) Scudder Cash Management QP Trust is managed by Deutsche Investment Management Americas Inc. The rate shown is the annualized seven-day yield at period end. (b) Transactions in Securities of Affiliated Issuers. An affiliated issuer includes any company in which the Fund has ownership of at least 5% of the outstanding voting securities. A summary of the Fund's transactions during the three months ended September 30, 2004 with companies which are or were affiliates is as follows:
Purchases Sale Realized Divdend Affiliate Shares Cost ($) Cost ($) Gain/Loss ($) Income ($)* Value ($) - ---------------------------------------------------------------------------------------------------------------------------------- Anycell, Inc. 1,250,000 - - - - - - ---------------------------------------------------------------------------------------------------------------------------------- BYC Co., Ltd. 39,530 - - - - 1,586,006 - ---------------------------------------------------------------------------------------------------------------------------------- Jeonbuk Bank 2,706,500 - - - - 9,342,890 - ---------------------------------------------------------------------------------------------------------------------------------- Nam Yang Dairy Products Co., Ltd. 44,550 - - - - 11,661,439 - ---------------------------------------------------------------------------------------------------------------------------------- Oriental Fire & Marine Insurance Co. 584,860 - - - - 7,872,627 - ---------------------------------------------------------------------------------------------------------------------------------- Samsung Climate Control Co., Ltd. 827,630 - - - - 3,622,454 - ---------------------------------------------------------------------------------------------------------------------------------- Samwoo EMC Co., Ltd. 754,800 2,092,375 - - - 1,864,877 - ---------------------------------------------------------------------------------------------------------------------------------- SE Co., Ltd. 636,950 - - - - 1,736,885 - ---------------------------------------------------------------------------------------------------------------------------------- Seoul Semiconductor Co., Ltd. 1,003,900 4,775,077 - - - 10,461,832 - ---------------------------------------------------------------------------------------------------------------------------------- Taegu Department Store Co., Ltd. 1,286,110 3,965,096 - - - 8,890,521 - ---------------------------------------------------------------------------------------------------------------------------------- Telephus Co., Ltd. 2,266,667 - - - - 2,952,671 - ---------------------------------------------------------------------------------------------------------------------------------- 10,832,548 59,992,202 - ----------------------------------------------------------------------------------------------------------------------------------
* Net of foreign taxes withheld. (c) Securities valued at fair value by management and approved in good faith following procedures approved by the Directors, amounted to $6,042,215 (0.6% of net assets at September 30, 2004). Their values have been estimated by management in the absence of readily ascertainable market values. However, because of the inherent uncertainty of valuation, those estimated values may differ significantly from the values that would have been used had a ready market for the securities existed, and the difference could be material. The cost of these securities at September 30, 2004 aggregated $8,622,435. The securities may also have certain restrictions as to resale. (d) The Fund may purchase securities that are subject to legal or contractual restrictions on resale ("restricted securities"). Restricted securities are securities which have not been registered with the Securities and Exchange Commission under the Securities Act of 1933. The Fund may be unable to sell a restricted security and it may be more difficult to determine a market value for a restricted security. Moreover, if adverse market conditions were to develop during the period between the Fund's decision to sell a restricted security and the point at which the Fund is permitted or able to sell such security, the Fund might obtain a price less favorable than the price that prevailed when it decided to sell. This investment practice, therefore, could have the effect of increasing the level of illiquidity of the Fund. The issuers of Anycell, Inc. and SE Co., Ltd. have given the Fund a put option, payable on demand. Information concerning such private placement securities at September 30, 2004 is as follows:
Acquisition Acquisition Value as % of Securities Date Cost ($) Value ($) Net Assets - ---------------------------------------------------------------------------------------------------------------------------------- Anycell, Inc. 12/22/2000 2,020,774 - - - ---------------------------------------------------------------------------------------------------------------------------------- SE Co., Ltd. 12/22/2000 1,616,637 1,736,885 0.2% - ---------------------------------------------------------------------------------------------------------------------------------- Telephus Co., Ltd. 6/10/2004 2,919,708 2,952,671 0.3% - ---------------------------------------------------------------------------------------------------------------------------------- Total Restricted Securities 6,557,119 4,689,556 0.5% - ----------------------------------------------------------------------------------------------------------------------------------
(e) Company in restructuring process, principal only subject to repayment. (f) Principal amount stated in Korean Won. (g) The Fund owns 1.36% of outstanding shares of Hankang Restructuring Fund, which is managed by Deutsche Investment Management Americas, Inc. (h) Company is in process of liquidation. (i) At September 30, 2004, 19.4% of the Fund's investment portfolio is invested in Samsung Electronics Co., Ltd. 144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Registrant: The Korea Fund By: /s/Julian Sluyters --------------------------- Julian Sluyters Chief Executive Officer Date: November 19, 2004 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Registrant: The Korea Fund By: /s/Julian Sluyters --------------------------- Julian Sluyters Chief Executive Officer Date: November 19, 2004 By: /s/Paul Schubert Paul Schubert Chief Financial Officer Date: November 19, 2004 EX-99.CERT 2 certifications.txt CERTIFICATIONS CERTIFICATIONS I, Julian Sluyters, certify that: 1. I have reviewed this report on Form N-Q of The Korea Fund; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Registrant: The Korea Fund By: /s/Julian Sluyters -------------------------- Julian Sluyters Chief Executive Officer Date: November 19, 2004 CERTIFICATIONS I, Paul Schubert, certify that: 1. I have reviewed this report on Form N-Q of The Korea Fund; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Registrant: The Korea Fund By: /s/Paul Schubert -------------------------- Paul Schubert Chief Financial Officer Date: November 19, 2004 -----END PRIVACY-ENHANCED MESSAGE-----