Kolmar BNH Holds Extraordinary Shareholders' Meeting on the 26th
Appointment of Yoon Sanghyun and Seungwha Lee as Inside Directors Approved
In the Kolmar Group management dispute, Yoon Sanghyun, Vice Chairman of Kolmar Holdings, has gained the upper hand. Vice Chairman Yoon faced off against the alliance of his father, Yoon Donghan, Chairman of Kolmar Holdings, and his younger sister, Yoon Yewon, President of Kolmar BNH, and has taken control of the Kolmar BNH board of directors. As a result, the eldest son will now lead Kolmar Group's health functional food business, in addition to its cosmetics and pharmaceutical divisions. However, a lawsuit remains in which Chairman Yoon Donghan has requested the return of Kolmar Holdings shares that he previously gifted to Vice Chairman Yoon. This lawsuit is expected to be a decisive point in the ongoing management dispute.
On the 26th, Kolmar BNH held an extraordinary general meeting of shareholders at Sejong Technopark in Jochiwon-eup, Sejong City. Photo by Minji Lee.
On September 26, at an extraordinary general meeting of shareholders held at Sejong Technopark in Jochiwon-eup, Sejong City, Kolmar BNH passed the agenda proposed by its largest shareholder, Kolmar Holdings, to appoint Vice Chairman Yoon Sanghyun and Lee Seunghwa, an advisor to CJ CheilJedang, as inside directors. The meeting was chaired by Won Jaesung, Executive Director and Chief Financial Officer of Kolmar Holdings.
A total of 494 shareholders, including proxy holders, attended the meeting, representing 19,728,835 shares. This accounts for 69.7% of all shares with voting rights. The core agenda items-appointing Yoon Sanghyun and Lee Seunghwa as inside directors-each secured approval from more than half of the shareholders, with approximately 13.79 million and 13.78 million shares in favor, respectively.
The current board of directors consists of three members from the father-daughter alliance (Yoon Yewon, Cho Youngjoo, and Yoon Donghan) and three from Vice Chairman Yoon Sanghyun’s side (Oh Sangmin, So Jinsu, and Kim HyunjunH). However, with the addition of the new inside directors from Vice Chairman Yoon’s side, the eldest son’s group now holds five seats, outnumbering the father-daughter alliance’s three.
Neither Chairman Yoon Donghan, Vice Chairman Yoon Sanghyun, nor President Yoon Yewon attended the meeting. The shareholders’ meeting proceeded in a solemn atmosphere, attended by fewer than ten minority shareholders, along with employees and law firm representatives. Both Kolmar Holdings and Kolmar BNH meticulously checked the proxy forms they had received before the meeting began. Due to the time required to calculate the on-site shareholding ratio, including proxy shares, the meeting started about 30 minutes later than the scheduled time of 10 a.m.
This extraordinary general meeting was convened after the court approved Kolmar Holdings’ request in May to hold an extraordinary shareholders’ meeting against Kolmar BNH. At the time, Kolmar Holdings argued that Kolmar BNH’s stock price and performance had been neglected for an extended period and asserted the need for professional management, submitting an agenda to appoint new inside directors.
In response, President Yoon Yewon filed an appeal to revoke the approval of the extraordinary shareholders’ meeting and requested the appointment of an inspector. However, on September 23, the court dismissed the request for an injunction to suspend the resolutions of the extraordinary meeting, and all related lawsuits were withdrawn the day before the meeting.
The outcome of this extraordinary meeting was expected. Kolmar Holdings, led by Vice Chairman Yoon Sanghyun, owns approximately 48% of Kolmar BNH, while Chairman Yoon Donghan and his daughter together hold only 8.89%.
Yoon Donghan, Chairman of Kolmar Holdings; Yoon Sanghyun, Vice Chairman of Kolmar Holdings; Yoon Yewon, President of Kolmar BNH.
However, the management conflict within Kolmar Group is expected to continue for the time being. The key issue is the “share return lawsuit” filed by Chairman Yoon Donghan against his eldest son. In May, Chairman Yoon filed a civil lawsuit to cancel the 2019 gift contract for a 14% stake (4.6 million shares) and demanded the return of those shares from Vice Chairman Yoon Sanghyun.
Chairman Yoon claims that his eldest son violated the “management agreement” signed in 2018 at the time of the share gift by interfering in the management of Kolmar BNH. The tripartite agreement, signed by Chairman Yoon Donghan, President Yoon Yewon, and Vice Chairman Yoon Sanghyun, stipulated that both Vice Chairman Yoon (Kolmar Holdings) and President Yoon (Kolmar BNH) would manage their respective companies independently, and the shares were gifted on the condition that this independence be maintained. The court hearing is scheduled for October 23.
The extraordinary general meeting of Kolmar Holdings scheduled for October 29 is also drawing attention. Previously, in July, Chairman Yoon requested an extraordinary meeting to replace the entire board of Kolmar Holdings with himself, President Yoon Yewon, and their allies, and Vice Chairman Yoon Sanghyun’s side accepted this request. Currently, Vice Chairman Yoon Sanghyun is the largest shareholder of Kolmar Holdings with a 31.75% stake,President Yoon Yewon and her husband hold 10.62%, TOA (formerly Japan Kolmar) owns 7.8%, Dalton owns 5.69%, and Chairman Yoon Donghan holds 5.59%, bringing the combined stake of Vice Chairman Yoon and Dalton to 37.44%, which is overwhelmingly higher than the 16.21% held by Chairman Yoon and his daughter.
A Kolmar Holdings representative stated, “According to the court’s ruling, the conditional nature of the share gift based on the tripartite agreement was not recognized. Since the Chairman and Vice Chairman are continuing to communicate, we expect the management dispute to be resolved amicably.”
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