Significant Expansion of Total Dividend Amount
Hyundai Department Store and Hyundai Green Food announced plans to repurchase and cancel treasury shares and significantly increase the total amount of dividends following a spin-off.
On the 31st, Hyundai Department Store disclosed that if the spin-off agenda is approved at the extraordinary general meeting scheduled for the 10th of next month, it plans to newly repurchase and cancel 6.6% of treasury shares within the next three years. Regarding 6.6% of treasury shares of Hyundai Department Store Holdings (newly established corporation) to be established through the spin-off, it plans to cancel them within one year after the spin-off is finalized. Hyundai Green Food also announced that it will newly repurchase and cancel 10.6% of treasury shares within the next six years. Hyundai GF Holdings (existing corporation) will also cancel 10.6% of treasury shares within one year after the spin-off is finalized.
Hyundai Department Store and Hyundai Green Food have also established aggressive cash dividend policies. After the spin-off, Hyundai Department Store (existing corporation) plans to establish a dividend policy guaranteeing a total dividend amount of 24 billion KRW for the 2021 fiscal year, and Hyundai Department Store Holdings (newly established corporation) intends to establish a dividend policy to pay a total dividend amount of at least 15 billion KRW in the future. Accordingly, the combined total dividends of the existing and newly established corporations after the spin-off of Hyundai Department Store are expected to increase by more than 60% compared to before the spin-off.
After the spin-off of Hyundai Green Food, Hyundai GF Holdings (existing corporation) plans to establish a dividend policy to pay a total dividend amount of at least 15 billion KRW, and Hyundai Green Food, the newly established corporation, also plans to establish a dividend policy so that the combined total dividends of the existing and newly established corporations after the spin-off can increase compared to before the spin-off.
A Hyundai Department Store Group official said, "The repurchase and cancellation of treasury shares and the establishment of dividend policies by Hyundai Department Store and Hyundai Green Food demonstrate a firm commitment to simultaneously enhance corporate value and shareholder value to the market," adding, "It is expected to dispel misunderstandings in the market, such as concerns about weakening dividends and strengthening controlling power of major shareholders through treasury shares, which were raised after the announcement of the spin-off promotion in September last year."
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