Palliser Capital ("Palliser") is encouraged by the outcome of LG Chem's Annual General Meeting ("AGM") today, at which Palliser's proposals received robust support from the majority of LG Chem's minority shareholders. This underscores unequivocal investor concerns relating to governance shortcomings and the Company's capital allocation policy.
While the voting influence of LG Corp prevented Palliser's resolutions from passing, the proposed resolutions to facilitate shareholder advisory proposals going forward and the appointment of a Lead Independent Director were supported by approximately 56% and 42%, respectively, of LG Chem's independent minority shareholders. When excluding votes cast by the second-largest shareholder, the National Pension Service of Korea, minority shareholder support for these resolutions was even higher, with approximately 71% and 53% voting in favour, respectively.
"This result represents a powerful signal from LG Chem's minority shareholders," said James Smith, CIO at Palliser Capital. "A majority of independent investors voted in favour of change. This level of support underscores shareholders' discontent with the status quo, including recent initiatives from the Company, as well as the growing expectation that LG Chem urgently reform its governance and capital management practices to take action on its deep valuation discount."
"We encourage LG Chem's Board and management, specifically the independent Chair,to engage constructively with shareholders and to respond meaningfully to the concerns expressed through this vote. Ignoring the voice of minority shareholders risks further eroding investor confidence."
Palliser's proposals were designed to enhance long-term shareholder value by strengthening accountability, improving transparency, and promoting better alignment between the interests of controlling and minority shareholders.
Majority-of-minority support is widely recognized as a critical benchmark for assessing shareholder sentiment, particularly in companies with concentrated ownership structures. Palliser believes that today's results should serve as a catalyst for LG Chem to take responsibility by adopting urgent measures to address the Company's significant value gap, failing which shareholders will no doubt look to take the initiative with bolder measures necessary to further strengthen their rights.
In the meantime, Palliser remains committed to continued dialogue with LG Chem and to advocating for governance reforms that support sustainable value creation for all shareholders.
About Palliser Capital
Palliser is an alternative investment manager that applies a value-oriented, event-driven philosophy to investing across a range of distinct yet complementary strategies on a global basis with a focus on situations where positive change and value enhancement can be achieved through thoughtful, constructive, and long-term engagement with companies and across a range of different stakeholder groups.
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Contacts:
Prosek Partners
Forrest Gitlin Kiki Tarkhan
Pro-Palliser@prosek.com
