President Lee Jae-myung’s remarks, followed by signals of support from Korea Development Bank, a major shareholder, have brought a possible relocation of HMM’s headquarters to Busan back into focus. Industry watchers say the company could replace three outside directors whose terms end next month, then call an extraordinary shareholders meeting to revise its articles of incorporation to enable the move. Union opposition, including the possibility of a strike, remains a key variable.
According to the industry on Wednesday, KDB Chairman Park Sang-jin said at a press briefing the previous day that the Ministry of Oceans and Fisheries and the Korea Ocean Business Corp. had presented a schedule to complete HMM’s move to Busan in March or April. “If the relocation is confirmed, we will actively support it,” Park said.
The comments effectively formalized the relocation push in line with Lee’s presidential campaign pledge. KDB and the Korea Ocean Business Corp. are HMM’s No. 1 and No. 2 shareholders, holding 35.42% and 35.08%, respectively.
The biggest obstacle is HMM’s articles of incorporation, which stipulate that the company’s headquarters is in Seoul. The company must revise the articles at a shareholders meeting before it can begin practical work for a relocation.
Amending the articles requires a special resolution backed by at least two-thirds of shareholders present. With KDB, the Korea Ocean Business Corp. and the National Pension Service holding more than 70% of HMM shares, the government could secure approval if the item is put to a vote.
Investment banking sources said the agenda for HMM’s regular shareholders meeting on March 26 is not expected to include an articles change. No such item was included in shareholder proposals that closed earlier this month.
In the shipping industry, a leading scenario is that KDB and the Korea Ocean Business Corp. will replace the three outside directors whose terms expire at the regular meeting, convene an April board meeting to approve an articles-change proposal, and then seek shareholder approval at an extraordinary meeting in May. Practical work for the Busan move is expected to ramp up in the second half of this year.
HMM’s onshore union, made up of employees working in Seoul, is strongly opposed. It is expected to begin rallies in the Yeouido area next week and hold a strike resolution rally in front of Cheong Wa Dae to block the relocation, according to reports.
Under labor law, management decisions such as relocating a headquarters are generally not subject to lawful industrial action. However, that could change when the amended Trade Union and Labor Relations Adjustment Act, known as the Yellow Envelope law, takes effect next month. If a management decision is interpreted as having a substantial impact on working conditions, it could be treated as a legitimate subject of labor action. If an HMM strike materializes, it would be the first general strike at a major company since the law’s implementation, drawing close attention from business, labor and legal circles.
* This article has been translated by AI.
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