This article was published on February 10, 2026 at 15:44 on Signal, the capital markets compass.
Conflicts between companies and minority shareholders are erupting across the board ahead of next month's regular shareholder meeting season. The trend is interpreted as minority shareholder coalitions gaining further momentum amid the revision of the Commercial Act and the strong push for shareholder value enhancement across the Korean stock market. However, side effects are emerging in the process, including minority shareholder coalitions filing excessive complaints with financial authorities and the Fair Trade Commission, and some shareholder representatives seeking economic gains from companies.
According to the business community and investment banking (IB) industry on Wednesday, KG Group filed a complaint late last year with the Seoul Gangnam Police Station against minority shareholder platform ACT and a minority shareholder coalition representative on charges of attempted extortion. "ACT separately demanded 50 million won from the company, offering to provide governance improvement consulting," a KG Group official said. "The company determined that such conduct was improper and did not comply, then submitted the complaint applying attempted extortion charges."
The minority shareholder coalition, composed of shareholders from six listed companies within KG Group including KG Chemical (001390), KG ECO Solutions (151860), and KG Mobility (003620), has been pressuring management through various channels since last year. Claiming private benefit-taking by the owner family, low shareholder returns, and inadequate investor relations (IR) activities, they submitted a petition to the Presidential Office last year and filed a complaint with the Fair Trade Commission against KG Group Chairman Kwak Jae-sun. Last month, they staged a truck protest near the former Cheong Wa Dae in an attempt to bring the issue into public discourse.
The problem is that some minority shareholder affiliates are obscuring the essence by demanding economic gains from companies on the pretext of enhancing shareholder value. Accordingly, criticism is growing within the business community that some operators repeatedly engage in pressuring companies through minority shareholder activities to obtain private gains.
A similar case is LS Essex Solutions, a unit of LS (006260) that recently withdrew its listing plan amid harsh criticism from minority shareholders. As fundraising plans went awry due to the failed listing, ACT reportedly attempted behind-the-scenes contact with LS Group, including offering to directly arrange 500 billion won in financing. "Using a voluntarily formed minority shareholder force to pressure a company and obtain separate economic gains may constitute extortion under criminal law or violate the 'prohibition on provision of benefits' specified in the Commercial Act," a legal source said.
Beyond LS and KG, conflicts between listed companies and minority shareholders are spreading in all directions ahead of regular shareholder meetings. Concerns are also mounting that some unethical cases may pour cold water on the broader governance improvement trend in the market.
E-Mart's (139480) plan to make Shinsegae Food (031440) a wholly-owned subsidiary for management efficiency is also facing a crisis amid intensifying opposition from minority shareholders. Most Shinsegae Food minority shareholders did not respond to E-Mart's tender offer, citing the low price. They also oppose the delisting through a comprehensive stock swap. To pressure the company, they have requested investigations by the Korea Exchange and the Financial Supervisory Service into the possibility of front-running.
Shareholders of ImmuneOncia (424870), a cancer drug R&D subsidiary of Yuhan Corporation (000100), are pushing to form an emergency response committee in protest of the recently announced 120 billion won rights offering. They argue that Yuhan, the largest shareholder, should fulfill its management responsibility by subscribing to 100% of its allocated shares. They have stated they will not rule out a class-action civil lawsuit if their demands are not accepted.
Sebang (004360) is suffering over the issue of treasury share disposal. The Sebang minority shareholder coalition criticized Sebang's swap of treasury shares with Hi-Vision System in July last year as an expedient measure to defend management control. Last month, they filed a petition with the Financial Supervisory Service requesting an investigation into Sebang's treasury share disposal. Sebang's position is that the shareholder coalition is repeatedly raising issues that have already been clearly addressed through past investigations by relevant agencies. The conflict shows signs of escalating, with Sebang warning it will take civil and criminal legal action if acts damaging the company's reputation without objective grounds continue.
"The atmosphere in which shareholders actively voice their opinions can serve as a catalyst for resolving the Korea Discount and advancing governance," said an official at one company in conflict with minority shareholders. "However, normal management activities are being threatened by repeated unethical behavior in which some pressure companies through relevant authorities while seeking private gains behind the scenes."
Notice Regarding 'Conflict Between KG Group and Minority Shareholders'
This newspaper reported on the matter on February 10 under the relevant headline.
Regarding the report, KG Chemical has informed us that the complaint it filed against the minority shareholder coalition representative was recently dismissed by police investigation due to insufficient evidence. In addition, the minority shareholder coalition representative has stated that he has not filed excessive complaints against KG Group nor demanded economic gains from the company, and that the report was not factual.
This report is in accordance with mediation by the Press Arbitration Commission.
