Publicly Listed Company Shares to Be Distributed 50% This Year and 50% Next Year
The EcoPro Group has decided to grant Restricted Stock Units (RSUs) not only to executives but to all employees starting this year. This move aims to share the company's performance gains with employees as the stock price of its holding company, EcoPro, has increased more than fivefold over the past year.
According to the group on the 23rd, four listed companies?EcoPro, EcoPro BM, EcoPro HN, and EcoPro Materials?recently announced their decision to grant RSUs to employees. The total number of eligible employees as of September 2022 is 2,706, and the number of shares granted was determined by comprehensively considering factors such as position, years of service, and annual salary, amounting to approximately 15-20% of the annual salary at that time. These employees will receive 50% of the RSUs on October 22 this year and the remaining 50% on October 22 next year. The total estimated value of the RSUs to be granted is about 38 billion KRW.
RSUs are a stock incentive system where the company directly transfers its treasury shares free of charge. This differs from stock options, which involve profiting from the difference between the stock price and the exercise price. While stock options allow the acquisition of shares at a pre-agreed exercise price and then selling them at market price, RSUs are distributed annually or paid out in a lump sum after several years. RSUs are regarded as a long-term executive compensation system that can maximize corporate value, unlike stock options which tend to focus on short-term performance.
The EcoPro Group expects that granting RSUs, which link company stock price and compensation, will motivate employees' performance and enhance shareholder value through improved results.
Listed companies within the group grant their listed shares to employees, while unlisted companies grant shares of their listed parent company. For example, EcoPro EM, an unlisted company, grants shares of its listed parent company, EcoPro BM. It is unusual to grant RSUs to employees of both listed and unlisted family companies.
EcoPro Group started in 1998 with one employee and capital of 100 million KRW. As of the end of last year, it has assets of 7.5 trillion KRW, sales of 7.2 trillion KRW, 3,300 employees, and exports exceeding 100,000 tons. The combined market capitalization of the group companies is 38.9 trillion KRW, approaching 40 trillion KRW. Recognized by the market for the value of its battery material value chain?from lithium (raw material) to precursor (intermediate material) to cathode active material (finished material)?EcoPro’s stock price rose from around 110,000 KRW at the beginning of last year to 510,000 KRW currently.
The EcoPro Group views employee efforts as a major factor in this growth and has expanded the scope of RSU recipients. An employee scheduled to receive RSUs said, "It is very meaningful to share the fruits of the company's growth with all employees," adding, "This will create an atmosphere where higher challenge goals are set and efforts are made to achieve them."
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