March 11, 2000 
| | |
| ||
| March 11, 2000 | atimes.com | |
| ||
| The Koreas Listed firms brace for shareholder backlash SEOUL - Listed companies are concerned about looming shareholders' meetings, expecting heated complaints over falling share prices. The companies are pulling out all the stops to stop the trend, but most of their efforts have been in vain. Many firms have announced plans to buy back and "burn" their shares, and are hosting "investor relations" (IR) sessions in a last-minute effort to boost prices. Unfortunately, the fever for "new economy" Kosdaq shares is not cooling, and many of the companies listed on the Korea Stock Exchange (KSE) are seeing the stock price slide continue unabated. Eighty-four KSE-listed companies have bought back shares worth 1.54 trillion won (US$1.37 billion) this year by establishing funds through banks and investment trusts, and 50 of them have done so in the past month. Chairman Yoo Sang-boo of Pohang Iron and Steel, or Posco, said in an IR session on February 25 that the company would buy back 4.8 million shares worth 500 billion won. Korea Telecom announced at a board meeting on Wednesday that it would buy back 100 billion won worth of its shares. Korea Tobacco and Ginseng Corp spent 200 billion won to buy back shares, and Keumgang 500 billion won. Kolon Engineering and Construction is campaigning among its employees to buy out their shares. The Hyundai Group is rushing to save its stocks after experiencing a huge fall. Hyundai launched an IR division and even sent out investor-friendly press releases such as its "Hyundai forms alliance with an international car maker" of a few days ago. Group founder Chung Ju-yung issued a special order to better manage share prices, and Hyundai announced on Tuesday that it will invest 540 billion won in the venture business to overcome its image as a heavy industry group. Prior to the Tuesday announcement, Hyundai Elevator, Hyundai Fire and Marine Insurance, Hyundai Heavy Industry, Hyundai Corp, Hyundai Merchant Marine Co and Hyundai Mipo Dockyard announced that they will spend up to 200 billion won to buy back stock. The efforts of most companies, however, have been in vain. Any positive effect achieved by share buy-backs lasted only about a day. Posco's share price rose by about 5,000 won on the day of chairman Yoo's announcement of a share buy-back in February, and closed at 117,000 won. But the price dropped 5,500 won the following day and has not recovered the 110,000-won level since. The share price of the steel maker peaked at 177,500 won last September. Aekyung Petrochemical began buying back its stock on February 17, spending 10 billion won. Its stock price rose to 31,300 won but plunged the following day by its permissible limit. Hyundai Motors experienced the same fate. On Tuesday, the day it announced it would buy back and burn its shares, the value hit the ceiling for one day but fell thereafter. Dongwon Fisheries, Hyundai Elevator, Ssangyong Oil Refining and other companies are still struggling to prop up share prices. (Asia Pulse/Yonhap) | |||||||||
 |
|
Front | China | Southeast Asia | Japan | Koreas | India/Pakistan | Central Asia/Russia | Oceania Business Briefs | Global Economy | Asian Crisis | Media/IT | Editorials | Letters | Search/Archive |
back to the top ©1999 Asia Times Online Co., Ltd. |
