Park Chul Whan of Kumho Petrochemical Unveils 'Proposal to Enhance Corporate Value', Committed to Transforming the Company for the Benefit of All Shareholders
- Park: "Kumho Petrochemical's shareholder value is significantly undervalued despite its outstanding operating performance compared to its peers."
- He aims to raise both shareholder and corporate value by improving the fundamentals to meet global standards through 'focus on future growth', 'improved governance' and 'management for sustainability'
- He will carry on active communication with fellow shareholders via 'Go Beyond, Kumho Petrochemical' website to voice his ideas for enhancing corporate and shareholder value
SEOUL, South Korea, March 4, 2021 /PRNewswire/ -- Park Chul Whan, the largest individual shareholder and senior executive of Kumho Petrochemical, released his 'Proposal to Enhance Corporate Value,' and set out to communicate with other shareholders ahead of the annual general meeting of shareholders to be held this month.
The proposal, subtitled 'Transforming into a Company for All Shareholders', provides detailed guidelines to achieve innovation, containing 'Background of the Shareholder Proposal', 'Current Status of Kumho Petrochemical and the Need for Change', 'Measures to Enhance Shareholder Value' and 'Measures to Enhance Corporate Value'.
Park said, "This shareholder proposal is the first step in enhancing shareholder and corporate value." And emphasized the necessity of 'normalizing shareholder return policy', 'efficient management of resources' and 'well-grounded investment decisions to secure drivers of future growth'. He stressed the need to establish an organization that can supervise and hold the board of director's decision-making process as well as its reform in check.
Factors cited as causes of Kumho Petrochemical's low corporate and shareholder value include - increased cost of capital due to excessive cash holdings and low debt - shareholder-unfriendly policies such as low payout ratio and excessive level of treasury stock - decreased growth potential as a result of inappropriate investments. The proposal states that although Kumho Petrochemical outcompetes its domestic and foreign peers in profitability and operating performance, aforementioned management issues have destroyed shareholder value and caused the company's stock price to remain undervalued for the past 10 years.