SK Holdings and SK C&C will hold a general shareholders’ meeting on June 26 and decide whether or not they will grant permission for the merger in order to start as an integrated corporation. Even though there are variables, including the National Pension Service exercising their shareholder’s rights, industry watchers believe that the proposal to merge the two companies will be voted through without a problem.
According to industry sources, SK Holdings and SK C&C will host their general meetings of stockholders on June 26, and decide whether or not they will approve the merger. In April, SK C&C and SK Holdings decided to merge at a ratio of 1:0.74, respectively.
More than two thirds of participating voting rights and more than one third of the total number of issued stocks are needed for the merger. For SK Holdings, the stock ownership ratio of SK Group Chairman Chey Tae-won to the largest shareholders and affiliated persons, including SK C&C, reaches 31.87 percent, while its rate reaches 49.43 percent for SK C&C.
Industry sources expect that the merger will be granted without a problem, unlike the merger of Samsung C&T and Cheil Industries, since there is no attack from a hedge fund, and many shareholders think positively about the mergers' effects.
However, one of the variables is how the National Pension Service, the only shareholder with more than 5 percent besides the largest, will decide about the merger. In Nov. last year, the National Pension Service announced its opposition to the merger and scuttled it by exercising the appraisal right of dissenting shareholders, as the stock prices of Samsung Heavy Industries and Samsung Engineering decreased to below the prices of stock purchase rights.
However, the stock prices of SK C&C and SK Holdings recorded 274,500 won (US$247.71) and 195,500 won (US$176.92), respectively, which were both much higher than the stock prices of 230,940 won (US$209) and 171,853 won (US$155.52). Therefore, the National Pension Service is unlikely to exercise the right to claim the purchase. If SK C&C and SK Holdings has to pay more than 1 trillion won (US$904.98 million) for the stock purchase, both companies will retract the merger.
Meanwhile, SK Holdings and SK C&C have come up with a plan to record 200 trillion won (US$181 billion) in sales and 10 trillion won (US$9.05 billion) in pre-tax profits by 2020, by focusing on the growth of the five sectors of IT services, ICT, LNG, biopharmaceutical, and the semiconductor material and modules, after the merger.