SK Chemicals Co. Ltd.

12/03/2021 | Press release | Distributed by Public on 12/03/2021 01:48

Decision on Split-off

Report of Disclosure Revision
Revision Date 2021-12-01
1. Disclosure Documents in relation with Revision Report on Key Matters / Matters Required to Report to the Exchange
2. Submission date of documents 2021-09-15
3. Reason for Revision Change of tradename for the newly spun-off company
4. Revised Information
information before revision after revision
1. Method of split-off
- (1) 		- Newly incorporated company: SK Multi-Utility Co.,Ltd.(tentative name)
* The company name of the newly incorporated company may change at the general shareholders' meeting for approval of the division plan or the inaugural meeting of the newly incorporated company. 		- Newly incorporated company: SK Multi-Utility Co.,Ltd.
7. Newly incorporated company by split-off
- Name of Company 		SK Multi-Utility Co.,Ltd.(tentative) SK Multi-Utility Co.,Ltd.
-
Decision on Split-off
1. Method of split-off (1) As stipulated in Articles 530-2 or 530-12 of the Commercial Act, a newly incorporated company shall be established by dividing the business units subject to division as follows, and as the company to be divided survives, 100% of the issued shares of the newly incorporated company will be allotted in a form of a simple and physical division. After the division, the company to be divided will remain as a listed corporation, and the newly established company will be an unlisted corporation.

- Company to be divided: SK Chemicals Co., Ltd.
- Business units to be divided: All business units excluding those subject to division

- Newly incorporated company: SK Multi-Utility Co.,Ltd.
- Business units of the newly-incorporated company: business units in relation to utilities supply such as electricity and steam

(2) The division date shall be December 1, 2021 (00:00). However, the division date is subject to change by resolution of the board of directors of the company to be divided.

(3) In accordance with the provisions of Article 530-3-1 and 2 of the Commercial Act, division will be carried out by a special resolution of the general shareholders' meeting, and in line with Article 530-9-2 of the same Act, unless otherwise specified in the division plan, a newly incorporated company has liability for the obligation with respect to debts transferred to the newly incorporated company resulting from division (including responsibilities, the same shall apply hereafter in the division plan). among the debts held by the company to be divided, and it does not have joint liability for the obligation with respect to debts that are not transferred to the newly incorporated company. By the same token, the company to be divided is not jointly liable for repayment of liabilities transferred to the newly incorporated company, rather, it is only responsible for repayment of liabilites that are not transferred to the newly incorporated company. In this regard, the company to be divided shall implement creditor protection procedures pursuant to the provisions of Articles 530-9 and 527-5 of the Commercial Act.

(4) In principle, unless otherwise specified in the division plan, those that relate to the business units subject to division for all active and passive properties belonging to the company to be divided as well as other rights and obligations including rights and obligations under public laws and factual relations with asset values (licenses, labor relations, contract relations, lawsuits) shall be reverted to the newly incorporated company, while those that are not subject to division shall be reverted to the company to be devided. Among the rights or obligations belonging to the business units subject to division, those that are prohibited from transfer following division by law or nature will be considered to remain in the company to be divided, and if a transfer to the newly incorporated company is deemed necessary, it will be addressed in line with consultations between the company to be divided and the newly incorporated company. (i) In the event that prior approval/authorization/acceptance of a report from government agencies, etc. is required for the division but cannot be received; or (ii) where contracts with the company to be divided as party to a contract are related to both the business units to be divided and those that are not, same shall apply if separating the portions related to the business units subject to division and the rest is not doable.

(5) Unless otherwise agreed by the company to be divided and the newly incorporated company, due to acts or facts prior to the division date in relation to the business of the company to be divided, obligations arisen and finalized after the division date, and obligations arising and finalizing after the division date (including contingent liabilities and all other liabilities under public/private statutes), that were not reflected in this division plan due to any circumstances, such as having already arisen and finalized prior to the division date, shall be reverted to either the company to be divided or the newly incorporated company according to the business unit to which the cause of act or fact belongs. And if it is unclear to which company the reversion should be made, the ratio of the net asset value at the time of division should be used to decide the reversion. However, the company to be divided and the newly incorporated company may address the issue by reaching a separate agreement.

(6) If the company to be divided, by performance of the obligation succeeded by the newly incorporated company in accordance with this division plan, or otherwise at its own expense, has procured a discharge for common profit, the company to be divided is entitled to reimbursement from the newly-incorporated company. The same can be also said in case the newly incorporated company, by performance of the obligation vested in the company to be divided in accordance with this division plan, or otherwise at its own expense, has procured a discharge for common profit.

(7) Unless the company to be divided and the newly incorporated company agree otherwise, due to acts or facts prior to the division date in relation to the business of the company to be divided, claims acquired after the division date (including contingent claims and any other claims under public/private statutes), rights and any other rights that were not reflected in the division plan due to any circumstances, such as having already been acquired before the division date, shall be reverted to either the company to be divided or the newly incorporated company pursuant to paragraph (5).

(8) The method of determining the assets, liabilities and capital of a newly incorporated company is based on allocating assets and liabilities belonging to or directly or indirectly related to the units subject to division to the newly incorporated company, provided that future operation and investment plans of the newly incorporated company, and the requirements of related laws and regulations be considered before making a final decision.
2. Purpose of split-off (1) By dividing the utilities supply business units (hereinafter referred to as "business units subject to division") such as electricity and steam among the bueinssses run by the company to be divided, the Company intends to enhance business expertise, strengthen management efficiency, and proactively respond to the rapidly growing global market.

(2) Putting in place a governance system that will enable prompt and professional decision-making according to the business characteristics of each business unit will lead to a timely response to market environments and institutional changes, and realize an enhanced focus on specialized business areas to diversify management risks.

(3) With specialization of each business unit, restructuring and intensive investments in core businesses will be facilitated and business sophistication will be realized.

(4) Ultimately, the change of the governance structure as described above will lead to the improved corporate value and shareholder value.
3. Material impact and effects of split-off This will produce a simple and physical division pursuant to the provisions of Articles 530-2 or 530-12 of the Commercial Act. Subsequently, there will be no change in the number of shares and ownership ratio of the largest shareholder of the surviving company before and after division. Furthermore, the division itself will have no impact on consolidated financial statements.
4. Split-off ratio -
5. Details of business and assets to be transferred through split-off (1) The company to be divided will transfer to the newly incorporated company all active and passive assets, other rights and obligations belonging to the units subject to division under public statutes, as well as factual relationships (including all licenses, labor relations, contract relations, lawsuits, etc.) with asset values, as prescribed by the division plan.

(2) Assets subject to transfer upon division shall be prepared on the basis of the statement of financial position attached, dated June 30, 2021 [Attachment 1] Division Statement of Financial Position, [Attachment 2] List of assets subject to succession. (i) However, until the division date, if changes in assets and liabilities of the business to be divided due to sales or financial activities of the business to be divided occur; or assets or liabilities that are omitted or incorrectly stated on the list of assets subject to succession are found; or the value of assets and liabilities change, they may be corrected or added in the Division Statement of Financial Position or list of assets subject to succession. (ii) The amount of cash and cash equivalents to be transferred on the date of division may be increased or decreased within the range of KRW 3,000,000,000 by the decision of the Representative Director of the company to be divided, taking into account the demand for funds necessary for the business of the newly incorporated company following the division.

(3) The value of the assets to be transferred according to the preceding paragraph, if necessary, may be finalized after being evaluated by a credible appraisal firm or reviewed by a certified public accountant.

(4) Among the rights or obligations belonging to the business units subject to division, those that are prohibited from transfer following division by law or nature will be considered to remain in the company to be divided, and if a transfer to the newly incorporated company is deemed necessary, it will be addressed in line with consultations between the company to be divided and the newly incorporated company. (i) In the event that prior approval/authorization/acceptance of a report from government agencies, etc. is required for the division but cannot be received; or (ii) where contracts with the company to be divided as party to a contract are related to both the business units to be divided and those that are not, same shall apply if separating the portions related to the business units subject to division and the rest is not doable.

(5) Movable property and real estate used for the operations of the business units subject to division, contractual relations that arise in relation to the business unit subject to division, and geun-mortgage established to secure rights related to the contract and other rights granted by way of security prior to the record date of division shall be reverted to the newly incorporated company within what is specified in the division plan.

(6) Among the lawsuits raised against or by the company to be divided prior to the record date of division, the lawsuits subect to succession shall be succeeded to the newly incorporated company.

(7) Immediately upon the establishment of the newly incorporated company, the company to be divided shall provide necessary support such as in the signing of related contracts so that the newly incorporated company will be able to conduct business in the same manner as business was conducted prior to the division by the business units subject to division.
6. Surviving company after split-off Name of company SK Chemicals Co., Ltd.
Financial status after split-off (KRW) Total assets 2,034,064,466,737 Total liabilities 800,048,065,082
Total shareholders' equity 1,234,016,401,655 Capital stock 66,050,330,000
2021-06-30 As of the reporting date
Sales of surviving business division of the latest fiscal year (KRW) 883,823,850,615
Main business Manufacturing, processing, sales, import and export of synthetic resins and related products, etc.
Remain listed after split-off? Yes
7. Newly incorporated company by split-off Name of company SK Multi-Utility Co.,Ltd.
Financial status at time of incorporation (KRW) Total assets 171,457,003,471 Total liabilities 14,254,006,139
Total shareholders' equity 157,202,997,332 Capital stock 5,000,000,000
2021-06-30 As of the reporting date
Sales of newly established business division of the latest fiscal year (KRW) 37,309,763,841
Main business Production, transportation, distribution of collective energy and related businesses, etc.
Re-listing planned? No
8. Details of capital reduction Capital reduction ratio (%) -
Period for submission of old share certificates Start date -
End date -
Scheduled period for trading suspension Start date -
End date -
Terms of new share allotment -
- Applicability of proportional share allotment and reasons -
Record date for new share allotment -
Scheduled delivery date of new share certificates -
Scheduled listing date of new shares -
9. Scheduled date of shareholders' meeting 2021-10-25
10. Filing period for statement of objections by creditors Start date 2021-10-26
End date 2021-11-26
11. Record date of split-off 2021-12-01
12. Scheduled date for registration of split-off 2021-12-02
13. Date of board resolution (decision date) 2021-09-13
- Attendance of outside directors Present (No.) 4
Absent (No.) 0
- Attendance of auditors (members of Audit Committee who are not outside directors) -
14. Signed a put option contract, etc.? No
- Details of agreements -
15. Subject to filing of securities registration statement? No
- Reasons for exemption, if exempted Simpleㆍphysical division
16. Other matters to be factored into investment decisions
(1) Revision and change of division plan
This division plan can be altered in the process of consultations with related organizations or approval of related laws and shareholders' meetings.
In addition, if the division plan is approved by the general meeting of shareholders, (i) the modifications or changes are reasonably necessary for the following list without additional approval of the general shareholders' meeting until the day before the division registration date, and that the modifications or changes do not pose any disadvantages to the shareholders of the company to be divided or the newly incorporated company, and (ii) if the modifications or changes do not impair the homogeneity of the company to be divided, it may be modified or changed by resolution of the board of directors of the company to be divided or the authority of the representative director, and the modifications or changes concerned will take effect upon notification or public disclosure pursuant to relevant laws and regulations.
① company to be divided and the company name of the newly incorporated company
② division schedule
③ assets to be transferred as a result of division and their values
④ financial structure before and after division
⑤ total number of shares issued by the newly incorporated company at the time of division
⑥ matters concerning, directors and auditors of the newly incorporated company
⑦ Articles of Association of the newly incorporated company and company to be divided
⑧ to be specified following confirmation of the division procedures of the land being divided of the real estate property to be transferred

(2) Appraisal rights of opposing shareholders "Not applicable" as this is a simple and physical division

(3) Matters that need to be acquired or handed over between companies
Regarding the implementation of the division plan, matters that need to be acquired or handed over between the company to be divided and the newly incorporated company (including documents, data, and various data and facts related to the business units subject to division) shall be separately agreed between the company to be divided and the newly incorporated company.

(4) Employee succession and severance pay, etc.
The newly incorporated company will succeed the employees working in the business units to be divided as of December 1, 2021 (the split-off date) and related legal relationships (their severance pay, etc.). However, for employees who refuse to be succeeded or those who are also related to other business units other than the business units to be divided, the company to be divided and the newly incorporated company may negotiate in a way that the newly incorporated company may not succeed them. For other matters regarding the employee succession will be addressed through negotiations between the company to be divided and the newly incorporated company.

(5) Transfer of personal information
As of the division date, all personal information shall be transferred to the newly incorporated company in accordance with personal information protection laws, such as the Personal Information Protection Act related to the business units to be divided, and the company to be divided shall undertake the required procedures within the deadline pursuant to the relevant laws and regulations, such as notification on the transfer of personal information resulting from the division.
※ Related disclosure -