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Orion Group to Burn 67.5 Billion Won in Treasury Stock to Boost Shareholder Value
🇰🇷 South Korea /Economy & Trade

Orion Group to Burn 67.5 Billion Won in Treasury Stock to Boost Shareholder Value

From Dong-A Ilbo · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

News Official statement New plan
  • Orion Group will incinerate all of its treasury stocks, totaling 67.5 billion won (approximately $48 million USD).
  • This move is part of the group's enhanced shareholder return policy, following recent dividend increases.
  • The incineration, scheduled for June 23rd, aims to boost shareholder value and create a virtuous cycle of growth and returns.

Orion Group is set to significantly enhance shareholder value by incinerating all of its treasury stocks, held by both its operating company, Orion, and its holding company, Orion Holdings. This decision reflects the group's ongoing commitment to strengthening its shareholder return policies.

The total value of the treasury stocks to be burned amounts to 67.5 billion won (approximately $48 million USD). Orion Holdings will incinerate 2,488,770 shares, representing 3.97% of its total issued shares, with a book value of 11.6 billion won and a market value of approximately 66.5 billion won based on the previous day's closing price. Orion will also dispose of its 7,344 treasury shares, which constitute 0.02% of its issued shares, valued at 600 million won on the books and about 1 billion won at the previous day's closing price.

This corporate action is a key component of the group's "Corporate Value Enhancement Plan," announced in March. The company stated that the treasury stock incineration is being carried out in accordance with the revised Commercial Act, which allows for such measures following its implementation. The incineration is scheduled to take place on June 23rd.

Following this year's dividend expansion, we have decided to incinerate our treasury stocks, continuously strengthening our shareholder return policy.

— Orion RepresentativeExplaining the company's strategy to improve shareholder returns.

In addition to the stock incineration, Orion has also met the criteria for high-dividend companies eligible for the separate taxation of dividend income, a measure introduced by the government in January to stimulate the capital market. The company's consolidated dividend payout ratio increased by 10 percentage points to 36% last year, while Orion Holdings saw its ratio rise by 25 percentage points to 55%.

An Orion representative stated, "Following this year's dividend expansion, we have decided to incinerate our treasury stocks, continuously strengthening our shareholder return policy." The company plans to foster a virtuous cycle where sustained growth translates into enhanced shareholder value, aiming for long-term value creation for its investors.

We plan to foster a virtuous cycle where sustained growth translates into enhanced shareholder value.

— Orion RepresentativeDescribing the long-term goals of the company's financial policies.
DistantNews Editorial

Originally published by Dong-A Ilbo in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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