ISS and Glass Lewis Recommend Samsung C&T Shareholders Vote FOR Both Value-Enhancing Shareholder Proposals
Today, CLIM and Whitebox announced that leading independent proxy advisory firms Institutional Shareholder Services Inc. (“ISS”) and Glass, Lewis & Co., LLC (“Glass Lewis”) have recommended that SCT shareholders vote for the Investor Group’s two value-enhancing shareholder proposals (the “Shareholder Proposals”) at the Company’s March 15, 2024 Annual General Meeting of Shareholders (the “Annual Meeting”).
City of London Investment Management Company Limited (“CLIM”), Whitebox Advisors LLC (“Whitebox”) and other long-term shareholders (collectively with the affiliates of Whitebox, the “Investor Group”) are significant shareholders in Samsung C&T Corporation (KRX: 028260) (“SCT” or the “Company”), with collective ownership in excess of 1% of the Company’s common shares. Today, CLIM and Whitebox announced that leading independent proxy advisory firms Institutional Shareholder Services Inc. (“ISS”) and Glass, Lewis & Co., LLC (“Glass Lewis”) have recommended that SCT shareholders vote for the Investor Group’s two value-enhancing shareholder proposals (the “Shareholder Proposals”) at the Company’s March 15, 2024 Annual General Meeting of Shareholders (the “Annual Meeting”).
CLIM and Whitebox invite all SCT shareholders and stakeholders to visit www.UnlockSCTValue.com to view our presentation, which details the merits of the Shareholder Proposals:
- Agenda Item 1-2-2: the distribution of a dividend of KRW 4,500 per common share and KRW 4,550 per preferred share to be paid in respect to FY 2023.
- Agenda Item 3: the allocation of KRW 500 billion to a share repurchase program during FY 2024.
In its full report, ISS expressed support for the Investor Group’s Shareholder Proposals:1
- “Given the company's robust balance sheet, improving operational performance and strong cash flow generation, support for the dissident proposals for a higher dividend and share buyback is warranted.”
- “The dissident has raised valid concerns with the company's suboptimal capital allocation practices, which management has failed to address.”
- “Instead of addressing the shareholder concerns, management turned to a ‘well-known tool of choice’ – a light-on-detail ambitious investment program that includes massive capex and promises of growth...”
- “…support for these proposals will send a clear signal to management that its current capital management practices should be revised.”
- “…the payment of a higher dividend and the share buyback are unlikely to have any negative impact on the company's liquidity or future capital needs.”
In its full report, Glass Lewis expressed support for the Investor Group’s Shareholder Proposals:2
- “On balance, we believe the Dissidents have presented a superior case to investors, drawing a persuasive throughline between the Company’s historical share price performance, present trading discount and seemingly less than urgent plans to remediate either.”
- “… we see little evident downside in supporting the resolutions submitted by the Dissidents at this time.”
CLIM and Whitebox commented:
“We are very pleased that both leading independent proxy advisory firms have recommended SCT shareholders vote for our two value-enhancing proposals. In its acknowledgment of the Company’s inadequate capital allocation policy and persistent valuation gap, ISS notes that our proposals are ‘unlikely to have any negative impact on the Company’s liquidity or future capital needs.’ As long-term shareholders, we believe in SCT’s immense potential value. The first step towards achieving that potential – in our view – is for SCT to adopt a transparent, shareholder-friendly capital allocation policy. An ideal approach will align shareholder returns with operational performance and balance distributions with new investments, while ensuring the Company maintains its financial resilience. We believe our thoughtful shareholder proposals can help deliver enhanced value for all SCT stakeholders.”
The Investor Group recognizes that many international shareholders may have a voting deadline as early as Tuesday, March 5, 2024. The Investor Group encourages shareholders to plan accordingly to ensure that their votes are tabulated. Shareholders who intend to submit their votes for the 2024 Annual Meeting can download the proxy form and statements from the website. All publications from the Investor Group, including the proxy form and reference documents under Article 152 of the Financial Investment Services and Capital Markets Act, can also be found on the website.
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INTERNATIONAL SHAREHOLDERS WILL ENCOUNTER EARLY VOTING DEADLINES – WITH SOME AS EARLY AS TUESDAY, MARCH 5, 2024. THE VOTING DEADLINES SET BY THE VOTING AGENTS ARE NOT THE OFFICIAL VOTING DEADLINES SET BY THE COMPANY.
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About CLIM
CLIM is a UK headquartered asset management firm, established in 1991. CLIM is a long-term investor in global markets via closed-end funds and other securities using a value-based approach exploiting anomalies between price and intrinsic value. CLIM has a strong focus on corporate governance and regularly engages with portfolio companies to enhance shareholder value.
About Whitebox
Whitebox Advisors LLC is a multi-strategy alternative asset manager that seeks to generate optimal risk-adjusted returns for a diversified base of public institutions, private entities and qualified individuals. Founded in 1999, Whitebox invests across asset classes, geographies, and markets through the hedge fund vehicles and institutional accounts we advise. The firm maintains offices in Minneapolis, Austin, New York, London and Sydney.
1 Permission to quote ISS was neither sought nor obtained. Emphases added.
2 Permission to quote Glass Lewis was neither sought nor obtained. Emphases added.
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