LG Corp. Sends Letter to Shareholders Requesting Approval for 'LX Holdings Split'

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[Asia Economy Reporter Jeong Hyunjin] LG Corporation sent a shareholder letter to its shareholders ahead of the regular general meeting of shareholders scheduled for the 26th, asking them to "approve the split." LG Corporation has put forward an agenda item for the upcoming shareholders' meeting seeking approval for the holding company split plan, including naming the newly established holding company as LX Holdings.

According to industry sources on the 19th, LG Corporation, through a shareholder letter dated the 16th from Ha Beomjong, Head of LG Corporation's Finance Team (Vice President), stated, "(The agenda for this shareholders' meeting) includes an item for approval of the company split, which is a core part of our long-term growth vision," and requested, "We ask for your support in approving this split."

LG Corporation's board of directors approved the spin-off plan on November 26 last year, which involves placing five companies?LG International, Pantos, LG Hausys, Silicon Works, and LG MMA?under a new holding company. The name of the newly established holding company, which will separate the affiliates centered around Koo Bon-joon, LG Advisor, was decided as LX Holdings, and it will be established on May 1.

In the shareholder letter, LG Corporation explained, "Through this split, we aim to reorganize our business portfolio and governance structure to diversify investment risks and enhance business-specific expertise, thereby strengthening competitiveness," adding, "Ultimately, we believe this will help alleviate the company's valuation discount issue and increase corporate value."

LG Corporation expects the split to have positive effects from two perspectives: investment and governance. From an investment perspective, LG Corporation stated, "(We believe) the long-term issue of discounting relative to our net asset value (NAV) can be alleviated," and analyzed, "Both companies will focus on their core businesses and develop expertise, enabling them to realize values that were previously difficult to achieve and maximize growth potential."

From a governance perspective, LG Corporation emphasized, "We intend to efficiently operate two independent holding companies to increase corporate and shareholder value in the long term," and added, "By splitting subsidiaries according to their business characteristics, both companies will be able to better respond to market changes through simplified decision-making processes under independent management."

The 59th regular general meeting of shareholders of LG Corporation is scheduled to be held at 9 a.m. on the 26th at the LG Twin Towers in Yeouido, Seoul. If this agenda is approved, LG Group's holding companies will be reorganized into two holding companies: LG Corporation and LX Holdings.

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