Kumho Petrochemical "Cha Partners, Representing Park Cheol-wan Personally... Unrelated to Shareholder Value"

"Focusing on Enhancing Shareholder Value Without Wavering"

Kumho Petrochemical stated that Cha Partners Asset Management, which allied with former Executive Director Park Cheol-wan, the largest individual shareholder, is acting on behalf of Park personally, and that the company will remain steadfast in focusing on enhancing shareholder value.

In a statement on the 8th, Kumho Petrochemical said, "We have determined that Cha Partners is effectively acting as a proxy for former Executive Director Park and that their claims to enhance the value of minority shareholders are unrelated."

Cha Partners Asset Management previously stated at a press conference on the 4th that "the shareholder proposal is unrelated to the management dispute between Chairman Park Chan-gu of Kumho Petrochemical Group and former Executive Director Park Cheol-wan, and is a shareholder activity aimed at enhancing the rights of minority shareholders."

Kumho Petrochemical pointed out, "In past shareholder proposals targeting other companies, Cha Partners held 1-3% stakes in those companies, thereby meeting the requirements to submit shareholder proposals themselves. However, regarding the Kumho Petrochemical shareholder proposal, Cha Partners held only 20 shares as of the record date at the end of 2023, which is the basis for confirming shareholders entitled to exercise voting rights at the regular general meeting, and held merely about 7,000 shares as of February 2024, the time of the shareholder proposal."

They explained that Cha Partners did not meet the requirements as a shareholder proposer and that the shareholder proposal was submitted through a joint holding agreement with former Executive Director Park, effectively delegating the shareholder proposal rights, which means they are acting on behalf of Park personally.

Additionally, Kumho Petrochemical stated, "Although Cha Partners denies having any compensation contract related to the success of the shareholder proposal or the increase in share value due to stock price rise, they also said it is difficult to disclose the contract details," emphasizing, "We are concerned that Cha Partners' shareholder proposal is not aimed at enhancing the value of minority shareholders but is an action for the benefit of former Executive Director Park personally."

Regarding Cha Partners' claim that the share exchange conducted to strengthen the partnership following the establishment of a joint venture with OCI in 2021 was for defending management rights, Kumho Petrochemical said, "Despite the court's dismissal ruling in November last year on the lawsuit filed by former Executive Director Park to invalidate the disposal of treasury shares, confirming that the transaction was legitimate, raising this issue again is also seen as an extension of the management dispute acting on behalf of a specific individual."

Furthermore, Kumho Petrochemical criticized, "Cha Partners criticized Kumho Petrochemical for disposing of treasury shares for the purpose of defending management rights and assumed that the treasury shares were disposed of to friendly parties," calling it "an act that distorts the essence of company policy and misrepresents the truth."

In a statement released on the 6th, Kumho Petrochemical had declared, "The company has never disposed of treasury shares for the purpose of defending management rights, nor does it plan to do so in the future."

Kumho Petrochemical reiterated its commitment to focusing more on enhancing shareholder value. On the 6th, the company announced a shareholder value enhancement plan to cancel 50% of its existing treasury shares (2,624,417 common shares) over the next three years, including the cancellation of 875,000 common shares on the 20th of this month.

Kumho Petrochemical added, "Holding the remaining 50% of treasury shares aligns better with medium- to long-term corporate value by preparing for potential financial soundness deterioration and enabling opportunities for business expansion and new ventures through mergers and acquisitions (M&A). Immediate cancellation of all treasury shares does not guarantee stock price support and carries the risk of losing financial liquidity that could be used as investment capital when needed."

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