On July 2, Jungang Advanced Materials announced via a regulatory filing that Atlas Palcheon, which maintains its status as the largest shareholder through a joint exercise of voting rights agreement with Gwangmu, had traded 41,494 shares in an after-hours transaction.
This share sale was carried out so that Atlas Palcheon could proactively terminate the pledge on Jungang Advanced Materials shares that had been provided as collateral for a loan. As a result, Atlas Palcheon's stake in Jungang Advanced Materials slightly decreased from 5.79% to 5.75%.
However, the combined stake with Gwangmu remains at 27.63%. In addition, Enchem, a major affiliate, continues to hold a 4.63% stake in Jungang Advanced Materials. The company explained that this proactive termination of the pledge has further stabilized management control.
It is generally known that proactively terminating a pledge can eliminate concerns about forced selling due to a decline in share prices and help stabilize management control.
Meanwhile, Gwangmu, which, together with Atlas Palcheon, holds the largest shareholder status in Jungang Advanced Materials, is one of Enchem's major affiliates.
A company representative stated, "As the prolonged concerns over the secondary battery chasm continue to create challenges across the industry, we decided to proactively terminate the pledge in order to maintain our commitment and responsible management of the lithium salt business, which the company is focusing on. We expect that, as the lithium salt business gains momentum and the secondary battery industry begins to recover, the company's value will rapidly increase."
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