SK Group Chairman Choi Tae-won will sell shares to pay for divorce property division

SK Group announced a disclosure statement on its equity changes on the 2nd. As the largest shareholder, group chairman Choi Tae-won will sell 1.653924 shares, equivalent to 2.3% of the issued shares. Choi Tae-won's move is intended to pay for the divorce property division with Noh So-young, director of Nabi Art Center. In late July, the South Korean court ruled that the man must pay the woman 944 billion won (approximately NT$23.538 billion) in the property division.

South Korea's "Business Korea" reported that Cui Taiyuan's shareholding will be reduced from 12,975,472 shares to 11,321,548 shares. Actual trading is expected to begin on November 2, one month after the disclosure announcement.

Choi Tae-won will secure 944 billion won in funds through the share sale, which is equivalent to the amount of divorce property divided by the court. Although Choi Tae-won appealed the ruling and the final amount of property division has not yet been determined, the share sale seems to be in response to capital needs that may be as high as 944 billion won.

An SK Group executive explained, "This equity change is designed to respond to the largest shareholder's personal financial needs related to property division litigation."

In order to avoid releasing a large number of stocks to the market at once and severely damaging the stock price, Cui Taiyuan decided not to sell stocks at once during normal trading hours. Instead, he chose after-hours trading combined with PRS (price return exchange contract) method.

SK Group stated that the focus of the equity sale is to minimize the impact of Chairman Choi Tae-won’s personal capital needs on the group’s management and stock price stability.

After the transaction is completed, Cui Taiyuan's shareholding ratio will drop from 17.8% to 15.5%. If special related persons are included, the shareholding ratio will drop from 25.2% to 22.9%.

In terms of voting shares, Cui Taiyuan's shareholding ratio will drop from 23.9% to 20.8%, and when special related persons are included, the shareholding will drop from 33.5% to 30.5%.

Although the shareholding ratio fell after the completion of the transaction, Cui Taiyuan's status as the group's largest shareholder remained unchanged. SK Group pointed out that the relevant transactions are expected to have limited impact on SK’s governance structure and management control, because the voting rights including special related persons are still 30.5%.