Hanmi Pharm Presidents Lim Jong-yoon and Lim Jong-hoon: "Dismissal from Presidency Appears to Be an Emotional Act Only"

by Jang Hyowon

Published 26 Mar.2024 09:00(KST)

[Image source=Yonhap News]

Hanmi Pharmaceutical Presidents Lim Jong-yoon and Lim Jong-hoon addressed their dismissal from the president positions on the 26th, stating, “We sincerely apologize once again for the family discord manifesting in this way,” and added, “With the shareholders' meeting on the 28th fast approaching, dismissing us from the president positions reflects personal emotions in management and is a highly unjust managerial act.”

They also said, “The reason given for the dismissal is damage to the company’s honor, which is completely unjustified,” and emphasized, “Rather, the current management should clearly explain and take responsibility for how subordinating the century-old family business established by the former chairman under another company benefits the company’s honor.”

The Lim brothers stated, “To resolve the issues the company faces, it is not about joining hands with just anyone, but starting from judging who is the right person to lead the company in the right direction for all shareholders and employees,” and stressed, “Although the conflict within the family is very painful, we will focus sincerely on finding ways to help the Hanmi Pharmaceutical Group and all shareholders, uphold the former chairman’s legacy, grow Hanmi Pharmaceutical into a global pharma company, and preserve the DNA of the Hanmi Pharmaceutical Group.”

They continued, “The Hanmi Alumni Association vote was conducted under the undue influence of the current management,” and expressed, “It is very heartbreaking to consider the difficulties faced by the subsidiary representatives under the direction and supervision of the holding company Hanmi Science’s management, as well as the employees suffering from an uncertain future,” assuring, “Even if we regain management rights, we will ensure that no personal disadvantages come to these individuals.”

Regarding the decisions announced so far by proxy advisory firms, they said, “Unlike the Hanmi Group, which can respond comprehensively through the IR team, we have not been given sufficient opportunities to explain the legitimacy of our shareholder proposals. Especially with overseas proxy advisory firms, we had little to no contact, or if we did, it was very late or limited in scope,” and added, “Nevertheless, the neutral or supportive opinions we received are believed to be based on the judgment that the current company’s proposed conglomerate merger does not enhance shareholder value. Considering this, we hope more shareholders will evaluate and recognize the legitimacy of our shareholder proposals.”

Regarding the low valuation of the intermediate holding company reported through Hanul Accounting Corporation, Hanmi’s side rebutted with the argument that “this merger transaction is unprecedented, and the samples used in the brothers’ data cannot be applied to this case,” but the brothers emphasized, “The fact that such a transaction is unprecedented means it lacks rationality and legitimacy,” and questioned, “Which major shareholder would degrade a top-performing ultimate holding company into an intermediate holding company?”

Furthermore, the Lim brothers commented on the National Pension Service’s upcoming decision, stating, “Similarly, the National Pension Service has had limited opportunities to hear the legitimacy of our shareholder proposals. However, given that personal and company transactions are packaged together, and that a director with conflicts of interest participates in the board, serious compliance issues with the current management must be reconsidered,” and added, “We expect them to fully consider the high possibility that this new share issuance will negatively impact the value of the shares held by the National Pension Service.”

Meanwhile, they noted, “When Chairman Shin Dong-guk’s sudden decision was announced on the 22nd, most shareholder chat rooms welcomed it,” and explained, “On the 25th, Hanmi Science and Hanmi Pharmaceutical stocks strongly rebounded because most small shareholder chat rooms have opposed the merger from the start and supported the brothers. In fact, the Hanmi Science Small Shareholders Coalition submitted a petition opposing the merger to the Suwon District Court, which supports this.”

Regarding the press conference held on the 25th by Chairman Lee Woo-hyun and President Lim Joo-hyun, the Lim brothers said, “Honestly, it’s embarrassing. The claims made through the country’s top legal team in written and oral arguments were all admitted to be false,” and added, “They said the new share issuance was necessary for company management and the other transactions were separate matters, with inheritance tax issues being secondary. However, Chairman Lee Woo-hyun confirmed that the new share issuance, the purchase of old shares, and the stock swap were a package deal, and President Lim Joo-hyun admitted that all of this was to resolve inheritance tax issues, not for the company’s benefit.”

They continued, “They say that if the inheritance tax issue is resolved through the transaction with OCI, the overhang issue will also be resolved. But if the brothers, who became small shareholders due to the loss of management rights, sell their shares, wouldn’t that be an overhang issue?” Regarding Chairman Lee Woo-hyun’s statement that he would reconsider the transaction if the court blocks the new share issuance, they said, “We cannot understand or accept entrusting the future of the Hanmi Pharmaceutical Group to a partner who plans to acquire a company with a market cap of 7 trillion won cheaply and is ready to give up if the court puts a brake on the new share issuance. It hurts our pride.”

Finally, the two brothers appealed once again, saying, “We ask once more that the family feud no longer tarnish the honor of the former chairman and the company,” and stated, “Once the company is normalized through the shareholders’ meeting, we will unite all family members and Chairman Shin Dong-guk’s support to cleanly resolve internal family issues and reveal concrete and realistic plans to carry on the former chairman’s legacy.”