SK Corp Shareholders Meeting Hearing Concludes, Decision Expected in December

Strategic Insights -

A Seoul court concluded the hearing on Sovereign Asset Management's petition for a special shareholders meeting of SK Corp, the world's second-largest refiner. Sovereign, the single largest shareholder with a 14.99 percent stake, is seeking to hold a shareholders meeting to change SK's articles of incorporation governing the qualifications for directors. Analysts have viewed Sovereign's move as an attempt to oust SK Chairman Chey Tae-won, who was convicted of fraud. The court is expected to make a decision within the month, with Sovereign predicted to win more than a third of the total voting rights and the support of two-thirds of the shareholders to have the articles of incorporation revised.

Key Takeaways:

  • Sovereign Asset Management, a Monaco-based private equity fund, has filed a petition for a special shareholders meeting of SK Corp, seeking to change the company's articles of incorporation.
  • The petition is seen as an attempt by Sovereign to oust SK Chairman Chey Tae-won, who was convicted of fraud, and improve corporate governance.
  • James Fitter, chief executive of Sovereign, has stated that the move is to give all shareholders the opportunity to elect the most competent and ethical management.
  • Fitter has also accused SK of having more than $3.5 billion in missing funds and criticized the company's campaign for South Koreans to buy shares to prevent a possible takeover.
  • If the court rules in favor of Sovereign, the company is expected to call a meeting in January at the earliest.
  • Foreign investors own 61 percent of SK Corp, with Sovereign holding a 14.99 percent stake.
  • The annual shareholders meeting of SK Corp is scheduled for March, where Chey fended off a hostile takeover bid by Sovereign by rallying enough support among friendly shareholders.

Statistics:

  • 14.99percent: Stake held by Sovereign Asset Management in SK Corp.
  • $3.5 billion: Amount of missing funds at SK Corp, according to James Fitter.
  • 61 percent: Percentage of foreign investors in SK Corp.
  • 14.99 percent: Percentage stake held by Sovereign in SK Corp.
  • 2/3: Percentage of shareholders required to support the revision of articles of incorporation, as per Sovereign's prediction.
  • March: Scheduled annual shareholders meeting of SK Corp.

Sources:

  • Asia Pulse
  • Yonhap News Agency
  • Financial Times