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Biz News Korea(Eng)

Eugene Group to up stake in Tongyang up to 25%

Collected: 2016.03.23

Distributed: 2016.03.25

Source: Go Direct

[Chung Jin-hak]

South Korea’s largest ready-mixed concrete company Eugene Group declared that it will participate in management of Tongyang Inc. by increasing its stake in Tongyang up to 25 percent, quashing the rumor that Eugene would sell off its stake in Tongyang to take short-term profits.

Chung Jin-hak, head in charge of construction materials unit of Eugene Group, said on Tuesday Tongyang needs a major stake holder who can lead the company in a clear and coherent direction. “Tongyang has tens of thousands of shareholders without a significant major shareholder after its workout program,” said Chung, adding, “As of late last year, among 34,000 shareholders, only four companies including Eugene Group and Pine Tree Investment and Management Co. own more than 1 percent stake, each.”

Currently, Tongyang’s largest shareholder Eugene Group holds a 10.01 percent stake in the company, slightly higher than 9.74 percent owned by Pine Tree Investment and Management. Chung defended that it is required to own about 25 percent stake to secure stable management control and Eugene Group would buy shares through all of possible measures such as purchasing shares directly from major shareholders, in a block trade or in the market.

He also expected Eugene Group would be able to further cement its leading position in the local ready-mixed concrete industry through synergy effects created with Tongyang. “We would make utmost efforts to raise shareholders’ value through stake purchase, dividend payouts and share buyback and we would strongly demand this to the management of Tongyang,” Chung added.

By Kim Hyo-hye, Chun Gyung-woon

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