Hanmi Science unveils proactive shareholder return policy

[Photo by Yonhap]

Hanmi Science Co., the holding company of South Korean Hanmi Pharmaceutical Group unveiled a proactive shareholder return policy once the sought-after merger between the Hanmi and OCI groups is complete, even amid continued opposition to the merger and a resulting family feud for control.

During a press conference at its headquarters in Seoul on Monday, Hanmi Science President Lim Ju-hyun apologized to shareholders for the ongoing family feud and promised to propose a “visionary and proactive long-term shareholder return policy beyond share buyback and retirement” once the integration with the OCI group is complete.

At the same press conference, Lim urged her brothers, Lim Jong-yoon of Hanmi Pharmaceutical Co. and Lim Jong-hoon of Hanmi Fine Chemical Co., to disclose specific details of their recently announced plan to attract 1 trillion won ($745 million) in investment to the Hanmi group, which they announced at their press conference last week where they also called for regulatory supervision of Hanmi’s merger with OCI.

The Lim brothers are sons of the late Chairman Lim Sung-ki, founder of the Hanmi Pharmaceutical group, and recently opposed the merger plans sought by their sister, Lim Ju-hyun, and their mother, Hanmi Science Chairperson Song Young-sook.

Hanmi Science’s Lim also demanded transparency regarding inheritance tax payments and the sources of funds from her brothers. “I hope my brothers will provide substantial and concrete measures to pay the remaining inheritance tax, as well as disclose their current debt status to our shareholders,” she said. Concerns have arisen about the funds for inheritance taxes after the founder’s passing, particularly as views on Lim Jong-yoon’s financial status are not positive.

OCI Holdings Co. Chief Executive Officer Lee Woo-hyun was also present at the press conference. “While considering various options for new drug development, we learned that our business directions aligned with Hanmi Pharmaceutical Group,” Lee said, explaining the background of the merger.

For its part, Hanmi Pharmaceutical Group also announced the dismissal of Hanmi Pharmaceutical Co.’s Lim Jong-yoon and Hanmi Fine Chemical’s Lim Jong-hoon on the same day. “The duo caused disputes over important resolutions of the Hanmi Science board that resulted in irreparable damage to the company’s reputation,” the group stated, citing Lim Jong-yoon’s “continuous negligence” of company affairs as another reason for dismissal. With this dismissal, the Lim brothers will no longer hold any roles within the group other than as shareholders.

Hanmi Science is now gearing up for a shareholder meeting on Thursday, where voting will take place over the appointment of six new directors, including President Lim Ju-hyun and OCI Holdings CEO Lee Woo-hyun, as well as the Lim brothers. With Lim Jong-yoon’s side holding a 20.47 percent stake and Lim Ju-hyun’s side holding a 21.86 percent stake, tensions are expected to be high, particularly after Hanyang Precision Co. Chairman Shin Dong-guk, who holds a 12.15 percent stake, recently expressed support for Lim Jong-yoon.