La Defense Partners is expected to exercise a casting vote over the ongoing management dispute at Hanmi Science Co. after the Seoul-based private equity firm increased a stake in the holding company of Hanmi Pharmaceutical Co. to 5%.
In after-hours trade on Tuesday, La Defense snapped up 950,000 shares in Hanmi Science from an unidentified global hedge fund, for 33.2 billion won ($24 million), or 35,000 won per share, people familiar with the matter told Market Insight, The Korea Economic Daily’s capital markets news outlet.
The purchase represented a 1.39% stake in its outstanding shares and a 3.24% premium to its Monday’s closing price. Earlier this month, a La Defense official said it would reform Hanmi’s governance in a strategic approach.
The global hedge fund unloaded the shares, most of its 1.05 million Hanmi Science shares after buying them in a block deal on Nov. 14. According to the sources, Lim Jong-hoon, Hanmi Science chief executive, was believed to sell the shares to pay inheritance taxes and debts.
Lim’s stake in the company has since fallen to 7.85% from 9.27%.
From the share trade with La Defense, the global hedge fund pocketed about 5 billion won in capital gains just two weeks after buying them from Lim.
La Defense’s purchase of Hanmi Science shares came on the heels of it buying a combined 3.7% stake in the company from Hanmi Pharmaceutical Group Chairman and Lim’s mother Song Young-sook and her daughter Lim Ju Hyun, as well as from the group’s cultural foundation.
They sold the shares to the private equity firm to raise funds for massive inheritance taxes after the group founder Lim Sung-ki died in 2020. The Hanmi founder family was owed a total of 540 billion won in inheritance taxes and has paid half of them as of mid-November.
Including La Defense and other shareholders in support for Song and her daughter, they control 49.42% of Hanmi Science, widening its gap with a 25.62% stake held by Song’s two sons: Lim Jong-hoon and Jong-yoon, older son and director of Hanmi Science.
But it might be too early for Song to breathe a sigh of relief. Its other minority shareholders, including the National Pension Service with a 6.04% stake, have not yet decided whether or not to vote at the upcoming shareholder meeting and if so, who it will vote for.
Worse yet, shareholders backing Song and her daughter could change their mind as did Hanyang Precision Co. Chairman Shin Dong-guk, bankers warn.
Shin withdrew his support for the Lim brothers and turned to their mother-sister alliance.
On Thursday, Hanmi Science will hold an extraordinary shareholder meeting. Song called for making a change to its articles of association to increase the number of directors on board to 11 from 10 and add Lim Ju Hyun and Hanyang Precision Chair Shin to the roster of directors.
In March, Song’s two sons blocked a merger between Hanmi Pharmaceutical with OCI Holdings Co., proposed by their mom Song, after they won a vote battle against the combination.
The share price of Hanmi Science slipped 1.03% to finish at 33,550 won on Tuesday and Hanmi Pharmaceutical closed steady at 279,500 won.
By Ji-Eun Ha
hazzys@hankyung.com
Yeonhee Kim edited this article.
