Hyundai Elevator sells a stake worth 116 billion won in Hyundai Movex

[Financial News] Hyundai Elevator will sell part of its stake in affiliate Hyundai Movex and cancel treasury shares worth 170 billion won. The strategy is to improve the efficiency of non-business assets, securing funds for shareholder returns while also enhancing corporate value.
Hyundai Elevator disclosed on the 16th that it had decided to sell 6.5 million shares of Hyundai Movex and cancel 2,487,323 of its treasury shares. The Hyundai Movex shares being sold represent about 5.8% of all shares issued. The sale price is 17,810 won per share, for a total transaction value of about 116 billion won. Once the sale is complete, Hyundai Elevator’s stake in Hyundai Movex will fall from 48.89% to 43.04%.
The stake sale will take place through an after-hours block trade rather than on-market trading. In particular, Hyundai Elevator will use a price return swap (PRS), with the shares being sold as the underlying asset, to ease the burden on ordinary shareholders from a decline in the share price. A PRS is a derivative financial transaction in which the parties to a contract settle gains and losses arising from changes in the price of the underlying shares. A rise in the share price can generate additional returns, but a decline could also result in losses.
Hyundai Elevator also disclosed its plan to cancel treasury shares that day. The cancellation will cover 2,487,323 shares, equivalent to 6.36% of the total shares issued, worth about 170 billion won based on the closing price on the 15th. The cancellation is scheduled for the 30th.
Canceling treasury shares is a key means of returning value to shareholders: it reduces the number of shares in circulation and increases the value of existing shareholders’ stakes. Hyundai Elevator plans to boost shareholder value and improve capital efficiency through this cancellation.
Of the treasury shares excluded from cancellation, 144,307 will be used, among other purposes, to fund the operation of the stock-based performance compensation program (RSU). The aim is to motivate executives and employees to deliver results over the long term.
The decision extends Hyundai Elevator’s new shareholder-return policy, announced last March. At the time, the company presented a shareholder-return policy that included a minimum dividend. Hyundai Elevator plans to continue working to improve corporate value by making non-business assets more efficient and implementing its shareholder-return policy.
[email protected] Jeong Won-il Reporter