[Asia Economy Reporter Park So-yeon] LG Chem's decision on whether to spin off its battery business will be made on the 30th. Amid opposition from minority shareholders and the second-largest shareholder, the National Pension Service, also opposing the spin-off, industry attention is focused on the outcome of the shareholders' meeting.
LG Chem will hold an extraordinary shareholders' meeting starting at 9 a.m. at the LG Twin Towers East Building basement level 1 auditorium in Yeouido, Seoul, with the agenda to approve the plan to split the battery business division.
If the spin-off plan is approved on that day, LG Chem will launch a new company, LG Energy Solution Ltd., in December.
For the agenda to pass, at least one-third of the total shares and two-thirds of the attending shareholders at the meeting must approve it.
LG Chem's shareholding structure includes 34.17% by related parties such as LG Corp., 10.20% by the National Pension Service, and 54.33% by others (foreign investors, domestic institutions, and individual shareholders). Among the other shares, foreign investors account for about 40%, and domestic institutions and individuals about 12%.
Approximately 22%, combining the National Pension Service and individual investors, are expected to vote against the spin-off.
Typically, 60 to 80% of shareholders attend LG Chem's shareholders' meetings. Assuming 80% attendance, two-thirds approval is required for the agenda to pass, meaning about 53% approval of the total shares is needed.
With LG-related parties holding about 34%, the key casting vote to decide the spin-off is expected to come from foreign investors.
Major domestic and international proxy advisory firms, including ISS, the world's largest proxy advisory firm, the Korea Corporate Governance Service, and Glass Lewis, have mostly issued favorable opinions on LG Chem's battery spin-off.
Since advisory firms that greatly influence foreign investors' decisions have recommended approval, it is generally expected that foreign and institutional investors will vote in favor.
Electronic voting conducted until the previous day has secured a significant number of approval votes, indicating a high likelihood of passage, according to industry sources.
However, due to opposition from the National Pension Service and others, the possibility of some foreign investors withdrawing their support cannot be ruled out.
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