LG has announced plans to burn all of its remaining treasury shares to enhance shareholder value. This follows the company’s decision last year to burn half of its treasury shares, as it accelerates its shareholder return initiatives.
On May 22, LG disclosed that it will burn 3,029,581 common shares, which represents 1.96% of its total issued shares.
Based on the closing price on that day, the total value of the shares is approximately 350 billion won. The book value, calculated at an average acquisition price of 82,520 won per share, amounts to about 250 billion won.
The scheduled date for the share burn is May 28.
Previously, LG had burned half of its treasury shares (6,059,161 shares) last year.
As one of South Korea's major conglomerates, LG is proactively reinforcing its shareholder return policy. At its regular shareholders' meeting in March, the company announced it would maintain a dividend of 3,100 won per common share.
Looking ahead, LG plans to actively use a portion of excess funds, excluding dividends and investment resources from temporary large profits or regular earnings, for share buybacks.
Last year, LG raised the lower limit of its dividend payout ratio from 50% to 60% based on adjusted net income. Consequently, the dividend payout ratio for 2025 reached 68%, meeting the criteria for high-dividend corporate tax separation.
As a result, the average dividend payout ratio over the past five years has remained high at around 69%.
In the long term, LG aims to increase its return on equity (ROE) to between 8% and 10% by 2027.
* This article has been translated by AI.
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