'Shareholder Activism' Hits MONA Yongpyong First... Company Says, "Return Plan Already in the Works" [fn Market Watch]

[Financial News]  Minority shareholders of MONA Yongpyong have begun taking concrete action, calling for shareholder returns. As they request to inspect and copy the shareholder register and move to consolidate their holdings, the company says it has already prepared a shareholder-return plan and has been coordinating when to announce it. With shareholder activism beginning before the return plan was disclosed to the market, attention is focused on whether the two sides will communicate and what return measures the company will introduce.
According to the MONA Yongpyong Minority Shareholders’ Coalition on the 21st, it sent the company a certified letter that day requesting to inspect and copy the shareholder register. Act, a minority shareholder platform, is also collecting electronic signatures for a shareholder letter. After collecting signatures through September 30, it plans to send an official letter to the company on October 1.
As of that day, 32 shareholders had participated in the electronic signing, representing a 4.56% stake. The shareholders’ coalition argued that, despite approximately 100 billion won in retained earnings, the company lacked a clear shareholder-return plan and had provided insufficient explanations of the profitability of its development business, borrowings and financial costs.
Yoon Ji-hoon, the shareholder representative, said, "We requested a return plan through shareholder meetings, letters and meetings with the CEO, but were unable to confirm any substantive measures." He added, "We will exercise the shareholder rights guaranteed under the Commercial Act."
The company’s explanation, however, differs. MONA Yongpyong says it had already been reviewing a shareholder-return plan independently of the minority shareholders’ latest action and is currently coordinating when to announce it. Since it has continued communicating with shareholders through meetings and discussions, there is also a sense that the company is somewhat taken aback that the matter has escalated to a request to inspect and copy the shareholder register.
A source familiar with the matter hinted, "I understand that the company did not directly inform the shareholders’ coalition in advance about the return plan it is preparing or the specific timing of its announcement." The source added, "The company had internally prepared a return option, but shareholders were unable to verify it. It appears that the resulting 'information gap' between the two sides has spilled over into shareholder activism." 
Meanwhile, MONA Yongpyong, formerly known as Yongpyong Resort, was listed on the Korea Exchange Main Board in 2016 at an IPO price of 7,000 won. According to the shareholders’ coalition, its recent share price is below 2,000 won and its PBR is around 0.26x. Its prolonged undervaluation is cited as the backdrop to the mobilization of minority shareholders.
Another source in the investment banking industry said,  "Even if the company is preparing a shareholder-return plan, it will be difficult for that to be reflected in the share price unless it is communicated to the market and shareholders," adding, "Ultimately, the level of the return plan MONA Yongpyong presents and when it presents it will be the next turning point in this shareholder activism." 


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