Executive Director Park Cheol-wan: "Companies Are Not Exclusive to Owner Families... Ownership and Management Must Be Separated"

Priority Suspension of Kumho Resort Acquisition Upon Entry of Inside Director
"Not a 'Nephew's Rebellion' Fighting His Uncle"... Transparent Board Operation and Separation of Ownership and Management

Park Cheol-wan, Executive Director of Kumho Petrochemical (center), held a press conference on the 11th at a hotel in Jung-gu, Seoul, explaining the shareholder proposal.

[Asia Economy Reporter Minwoo Lee] Park Cheol-wan, Executive Director of Kumho Petrochemical, who is in a management rights dispute with his uncle Park Chan-gu, Chairman of Kumho Petrochemical, demanded the separation of ownership and management, stating that a company is not the exclusive property of the 'owner family.' He criticized the acquisition of Kumho Resort and other assets as actions that harm the interests of all stakeholders, including shareholders and partners, and emphasized his intention to enter the board of directors to initiate reform.

On the 11th, Executive Director Park held a press conference titled "Proposal to Enhance the Corporate Value of Kumho Petrochemical" at a hotel in Jung-gu, Seoul, where he stressed these points. Park said, "A company is not the exclusive property of the owner family, and corporate management is not as simple or trivial as being summarized by terms like 'the nephew's rebellion.' The reason for submitting the shareholder proposal is skepticism about whether the current management and board of Kumho Petrochemical respect the opinions of various stakeholders and are striving for greater value." He argued that this is not a management rights dispute or what some call the 'nephew's rebellion,' but a measure to increase the company's value. However, he added, "There has been poor communication with the top management and regarding the Kumho Resort acquisition for about 10 years. It is very regrettable and unfortunate that there has been no communication channel." This suggests that the discord between the two sides did not arise suddenly.

Executive Director Park emphasized that if he enters as an inside director, he will first stop the acquisition of Kumho Resort. He said, "Kumho Resort has no connection or synergy with Kumho Petrochemical, a petrochemical company, yet it was acquired at a price about 50 billion KRW higher than competitors. A detailed due diligence is currently underway, and since the deal is expected to close within a month, if I enter the board, I will do my best to block it."

He also stressed his position to bring in new professional managers from outside to separate ownership and management from the owner family. He stated, "The professional management system is already a global standard. Although it may not perfectly fit the Korean environment, I believe that separating ownership and management is right for the company's long-term future."

However, he was reserved about specific strategies for securing shares ahead of the shareholder meeting vote. Executive Director Park currently holds a 10% stake as the largest individual shareholder. Chairman Park Chan-gu and Park Jun-kyung, Executive Director of Kumho Petrochemical and son of Chairman Park, hold 6.7% and 7.2%, respectively. Including related parties, their combined stake is about 14%. Since the difference in shareholding between the two sides is only 4 percentage points, the votes of the second-largest shareholder, the National Pension Service (8.16%), and small shareholders holding about 50% of the shares are crucial. Park said, "It is difficult to disclose details such as additional share purchases by the National Pension Service or relatives at this time."

Executive Director Park proposed three main directions: ▲ halting the Kumho Resort acquisition ▲ normalizing the undervalued corporate value ▲ improving governance through a board composed of professionals and diverse members. He strongly expressed confidence that "based on this, we can easily achieve a market capitalization of 20 trillion KRW by 2025," and appealed, "For the company's future and long-term plans, cooperation from both inside and outside the company is necessary, not just from me."

This content was produced with the assistance of AI translation services.