Huons Global (084110), the holding company of the Huons (243070) group, on Monday announced a shareholder return plan for minority shareholders as concerns mounted over a merger between its subsidiaries. The measure serves as compensation for criticism that the future value of unlisted affiliate Huons Lab is shifting to Huons, undermining the value of Huons Global shareholders.
Huons is a core subsidiary of Huons Global, while Huons Lab is a bio affiliate developing platforms including a human-derived hyaluronidase platform. Once the merger is completed, Huons will absorb Huons Lab.
Huons Global said it held a board meeting that day and resolved to distribute a portion of the new Huons shares it will receive from the merger of subsidiaries Huons and Huons Lab to minority shareholders as a dividend in kind. The largest shareholder, related parties, and treasury shares are excluded from the dividend.
Huons Global plans to distribute 260,038 of the new Huons shares allocated to it during the merger process to minority shareholders. Minority shareholders will receive one Huons share for every 20 Huons Global shares. The company decided to convert the new Huons shares acquired through the merger based on the minority shareholders' stake ratio and return about 30% of them.
Converting the dividend-in-kind at the Huons merger price of 34,062 won per share, the value is about 1,780 won per Huons Global share. Including the existing annual cash dividend of 800 won, the annual dividend per share rises to 2,580 won. The company estimated the total dividend at about 31.5 billion won, with a dividend yield of about 9% based on Friday's closing price.
The shareholder return plan reflects recommendations from a special committee formed after a shareholder briefing on Friday. The dividend in kind will be paid if the merger is finalized, and the company plans to carry out the dividend around April after approval at the regular general shareholders' meeting in March next year.
Song Soo-young, CEO of Huons Global, stressed, "We will complete the merger process reflecting shareholders' opinions and maximize corporate value and shareholder value."
