SK Telecom shares surged nearly 5% on the day a court ruled that SK Group Chairman Chey Tae-won must pay 944 billion won to his former wife, Roh Soh-yeong, director of the Art Center Nabi, as a division of assets. On the same day, the benchmark KOSPI fell more than 5%, triggering a sidecar that temporarily halts program sell orders.
According to the Korea Exchange, SK Telecom traded at 104,800 won around 2:16 p.m., up 5.33%. The gain later narrowed, but after staying flat throughout the morning, the stock jumped immediately following the ruling. It posted a strong performance on a day when a sell-side sidecar was triggered as the KOSPI dropped more than 5%.
The First Family Division of the Seoul High Court, presided over by Chief Judge Lee Sang-joo, ruled that Chey must pay Roh 944 billion won as a division of assets. The court determined that the SK shares held by Chey were subject to division, and set the division ratio at one-third for Roh and two-thirds for Chey. The court also ruled that any shortfall in the shares allocated to Roh must be paid by Chey in cash. The ruling came nine years after the legal dispute between the two began in July 2017, when Chey filed for divorce mediation.
Chey currently holds 12,975,472 shares of SK Inc., the holding company of SK Group, a stake of 17.90%. Because a significant portion of the asset division must be paid in cash, there is potential for expanded dividends. In a recent report, Hana Securities said it "names SK Telecom as its top pick," analyzing that "expanding dividends from strong subsidiaries is virtually the only way to reduce the recent governance-related issues at SK Group." It added that "SK Telecom, which has a high capacity to pay dividends, is likely to increase its payouts, shifting toward a structure in which dividends from strong subsidiaries can be delivered directly to the group's controlling shareholder."
