Truston Asset Management, the second-largest shareholder of Taekwang Industry, has directly raised concerns about the alleged involvement of the Taekwang Group's Management Council in the company's operations. Truston demanded a response within 30 days, warning that failure to comply could lead to actions such as convening an extraordinary shareholder meeting and filing a derivative lawsuit.
On September 3, Truston sent an open letter to the board of directors of Taekwang Industry, posing ten questions regarding the legal basis, composition, decision-making process of the Management Council, and its relationship with Taekwang Industry's management. The aim is to clarify the circumstances and accountability if the Management Council has indeed been involved in major decisions of Taekwang Industry.
Truston specifically referenced a 318.6 billion won exchangeable bond (EB) plan that Taekwang Industry pursued and later withdrew, as well as discussions about enhancing corporate value and shareholder return policies that may have been pre-discussed by the Management Council. They also highlighted that information regarding a 1.5 trillion won new business and EB plan was disclosed through the 'Taekwang Group Public Relations Office' before being approved and announced by the board on July 1 of last year.
Truston argued that the Management Council has been operating for an extended period without being explicitly mentioned in the articles of incorporation, business reports, or corporate governance reports, effectively making it a 'phantom organization.' They also pointed out that if the Management Council has indeed been involved in decision-making, the board's inaction on this matter is also problematic.
Concerns regarding shareholder returns were also raised. Truston noted that Taekwang Industry's average dividend payout ratio over the past 20 years has been around 1%, criticizing the lack of specific goals and timelines in the company's proposed dividend expansion and share buyback policies.
Truston stated that if Taekwang Industry does not provide adequate responses to the open letter, it will consider actions such as demanding access to books, audits, filing derivative lawsuits, and convening an extraordinary shareholder meeting. They also mentioned that if the Management Council's involvement is confirmed, they may explore criminal responses related to obstruction of business.
Truston emphasized, "If decisions have been made, accountability must follow, and if there is no accountability, they should step back."
* This article has been translated by AI.
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