 |
| Namyang Dairy headquarters located in southern Seoul / Newsis |
By Anna J. Park
Activist fund Tcha Partners Asset Management has launched a Namyang Dairy shareholder campaign urging the dairy company to take active measures to protect minority shareholders' rights.
According to Tcha Partners' proposals sent out the company boards earlier this week, the activist fund urged the firm to buy back 50 percent stakes of both common shares as well as preferred shares ― worth 191 billion won ($144 million) in total ― at the price of 820,000 won per share.
It is the price that Hahn & Co. agreed to pay per each stock, when the private equity firm signed a stock purchase agreement in May 2021 to acquire a 55.7 percent stake of the dairy company from the firm's founder and former Chairman Hong Won-sik.
"The proposal urging the firm to buy back the 190 billion won worth of common and preferred shares aims to provide an opportunity for exit to minority shareholders, who had been excluded from the stock purchase agreement of the firm's management rights in 2021," the activist fund's letter reads.
The activist fund, which owns a 3 percent stake in the dairy company, also called on the company to carry out a stock split of its preferred shares, in order to prevent delisting of them from local stock markets. Tcha Partners also urged the firm to pay out dividends of 20,000 won per common share and 20,050 won per preferred share.
Market watchers are paying attention to how the fund's shareholder campaign moves would affect the current entanglement involving Namyang founder Hong family and Hahn and Co. unfolds.
Since the private equity firm signed the deal to purchase the majority stake of Namyang Dairy at the price of 820,000 won per share in 2021, both sides have been mired in legal battles over management rights of the firm during the past two years.
Hahn and Co. won in both the trial and appellate courts in Sept. 2022 and Feb. 2023, respectively, and it's been somewhat evident that the private equity fund would finally succeed at holding the controlling stake and the management right of the company.
Yet, as the activist fund pointed out that the 820,000 won per share that Hahn and Co. pledged to pay to buy the controlling stake is too low, claiming that 1,160,000 won is appropriate, considering the dairy firm's net value. As the activist fund vowed to play a check against the private equity fund, in addition to the dairy company's management, it remains to be seen how the situation surrounding the dairy firm would develop in the future.
"It's not always the case that a company's values ameliorate, just because a private equity fund gets to take the hold of the firm," the activist fund explained. "The checks and balances against the private equity firms are also necessary for protecting the rights of minority shareholders," the fund highlighted.
![[RAS KOREA] Preserving memories at Cheongju City Archives](https://img.koreatimes.co.kr/upload/thumbnailV2/53ecc69c116c49af9ba0005288526ab5.jpg/dims/resize/178/optimize)
![[INTERVIEW] 'No more part-time jobs': VANNER talks about life after winning 'Peak Time'](https://img.koreatimes.co.kr/upload/thumbnailV2/79128864ba1643498f9a49fc7a82f2f1.jpg/dims/resize/178/optimize)
