Andaza Asset Management Sends Open Letter to SK Chemicals on "SK Bioscience Stock Dividend"

[Asia Economy Reporter Minji Lee] Andaz Asset Management has sent an open letter to the SK Chemicals board of directors, publicly demanding that SK Chemicals distribute about 10% of its SK Bioscience shares as a stock dividend to common shareholders.

Earlier this year, Andaz Asset Management proposed through the SK Chemicals shareholder activism campaign site that SK Chemicals sell part of its SK Bioscience shares and use the proceeds to enhance shareholder value.

In the shareholder letter, Andaz Asset Management stated, “Currently, SK Chemicals’ market value is undervalued by about 75% compared to its net asset value (NAV). Although the stock market has generally declined due to macroeconomic factors, SK Chemicals’ stock has fallen more than the KOSPI, necessitating measures to improve shareholder value.” As of the 4th, the KOSPI had dropped about 17% since the beginning of the year, but the company’s stock price fell 31%, nearly twice the decline of the KOSPI.

Park Cheolhong, head of ESG Investment at Andaz Asset Management, said, “Given the current stock market conditions, it is difficult for SK Chemicals to sell SK Bioscience shares. However, if SK Chemicals distributes about 10% of its SK Bioscience shares as a stock dividend to SK Chemicals shareholders, it would align the interests of the company’s management with those of all shareholders.”

Park added, “We will make our best efforts to ensure that the agenda for the stock dividend of SK Bioscience shares passes at the 2023 annual general meeting of shareholders through continuous communication with the company and shareholders.”