Kumho Petrochemical Major Shareholder Park Cheol-wan "Welcomes Half of Treasury Shares Being Cancelled"

Statement on Kumho Petrochemical Shareholders' Meeting
"Expectation for Announcement of Additional Burn Plan for Remaining Shares"

Park Cheol-wan, former executive director of Kumho Petrochemical and the largest shareholder of the company, issued a statement on the 29th saying, "I welcome Kumho Petrochemical's decision to cancel half of its treasury shares." Park Cheol-wan, the son of Park Jung-gu, former chairman of Kumho Group and the second older brother of Kumho Petrochemical Chairman Park Chan-gu, has been in a management rights conflict with his uncle, Chairman Park Chan-gu.

Park, the former executive director, said, "I welcome Kumho Petrochemical's progressive decision during this shareholders' meeting process to cancel half of the treasury shares it holds, which is a significant step forward compared to the past," adding, "There has been a major change this time regarding treasury shares, which are a core part of the government's value-up program."

Former Executive Director Park Cheol-wan of Kumho Petrochemical
Photo by Kumho Petrochemical

He continued, "I expect Kumho Petrochemical to demonstrate sincerity and determination to enhance shareholder value to the market and shareholders by clearly stating its position and plans for additional cancellation of the remaining treasury shares in the future."

Park also said, "I will continue efforts with all minority shareholders to increase shareholder value through the growth of Kumho Petrochemical and the enhancement of governance transparency."

Earlier, activist fund Cha Partners Asset Management, which was delegated shareholder proposal rights by Park, submitted shareholder proposals ahead of this year's general meeting. Cha Partners proposed three items: ▲amendment of the articles of incorporation related to treasury share cancellation ▲cancellation of treasury shares ▲appointment of Kim Kyung-ho, chairman of KB Financial Group's board, as an outside director on the audit committee.

Kumho Petrochemical stated that disposing of treasury shares all at once would cause management instability, and announced plans to cancel 50% of its treasury shares in installments over three years and to additionally acquire treasury shares worth 50 billion KRW for cancellation purposes.

The shareholder proposals from Cha Partners were all rejected at Kumho Petrochemical's general meeting on the 22nd.

Park Cheol-wan is the largest individual shareholder of Kumho Petrochemical, holding 9.01% of the shares. He has allies including his mother Kim Hyung-il (0.09%), his father-in-law Heo Kyung-soo, chairman of Cosmo Chemical (0.06%), and his sisters Park Eun-hyung, Eun-kyung, and Eun-hye (each 0.53%). Chairman Park holds 7.14%, his eldest son Park Jun-kyung, president, holds 7.65%, and his eldest daughter Park Joo-hyung, vice president, holds 1.04% of the shares.