Hanwha on Jan. 21 held a meeting at NH Investment & Securities' headquarters in Seoul's Yeouido attended by about 50 retail shareholders. It explained the purpose of the corporate spin-off approved by its board on Jan. 14 and measures to enhance shareholder value. The meeting was arranged to help retail shareholders better understand the spin-off, strengthen communication and build shareholder trust.

Hanwha said the main purpose of the spin-off was to eliminate a conglomerate discount by optimising its business portfolio. It plans to clarify the business identities of the surviving company and the newly established company, and to optimise strategy and investment by business group to encourage a market revaluation.

Han Sang-yoon (한상윤), an executive director in charge of investor relations at Hanwha, said, "As a conglomerate, we have not been properly recognised for our value in the market, so we expect this spin-off will allow us to fully reflect the value of our subsidiaries."

Hanwha also reaffirmed its intention to expand its shareholder return policy. It stressed it would implement the shareholder return policy presented when it announced the spin-off, including cancelling all 4.45 million treasury shares excluding those reserved for employee performance compensation, and setting a minimum dividend of 1,000 won per share. It added it would also consider continued dividend increases, taking into account the growth of its subsidiaries.

The market responded positively to the spin-off and the shareholder return policy. Securities firms assessed the spin-off as an opportunity to make the governance structure more transparent and reduce holding company discounts. Hanwha shares surged more than 25 percent on the day of the announcement.

During a question-and-answer session, one shareholder said, "I highly value the company's plans to enhance shareholder value, such as cancelling treasury shares," and asked about additional shareholder return policies. Hanwha replied, "There is no plan confirmed at present, but if we review it later, we will communicate transparently through disclosures and other means."

A Hanwha official said, "We will continue to strengthen transparent management and ongoing communication with shareholders, and do our best to ensure the market properly recognises our corporate value." Hanwha plans to hold meetings for overseas investors in Hong Kong, Singapore and elsewhere after this meeting.