ISS, a global proxy advisory firm, recommended that Doosan Enerbility shareholders oppose the proposal to split Doosan Bobcat shares and merge them with Doosan Robotics. In response, the activist fund Align Partners Asset Management expressed its support.
On the 29th, Align Partners stated, “ISS pointed out a conflict of interest among shareholders, noting that there is an economic incentive for controlling shareholders to pursue the split and merger by sacrificing minority shareholders of Doosan Enerbility.”
Previously, ISS issued a recommendation opposing the agenda to split the 46% stake held by Doosan Enerbility in Doosan Bobcat and merge it with Doosan Robotics. Align Partners also announced on the 27th that it would vote against the split and merger proposal.
Align Partners said, “There is a conflict of interest between controlling and general shareholders in the capital transactions between Enerbility and Robotics. It could lead to an economic incentive to use the influence of Chairman Park Ji-won of Enerbility to benefit the controlling shareholders at the expense of minority shareholders.”
They added, “Although an external evaluation was conducted, considering the significant conflict of interest, this cannot be regarded as the best alternative for the company. While splitting non-core shares has strategic meaning, the rationale for merging with Doosan Robotics lacks persuasive grounds and the valuation is unfavorable.”
Lee Chang-hwan, CEO of Align Partners, said, “The reason ISS pointed out the conflict of interest among shareholders is that Doosan holds about 30% of Doosan Enerbility shares but owns about 68% of Doosan Robotics shares,” adding, “If Doosan Bobcat shares are effectively sold at a discount, minority shareholders of Doosan Enerbility will suffer losses, while the controlling shareholder Doosan benefits.”
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