VIP Asset Management, which runs value-investing strategies, appears set to effectively halt the shareholder activism it has pursued against holding company Asia Holdings. VIP Asset Management recently began selling the Asia Holdings equity it had steadily accumulated since 2021 and disclosed that it changed the purpose of its shareholding from the previous "general investment" to "passive investment," indicating no intention to influence management control.
According to the Financial Supervisory Service's electronic disclosure system on the 18th, VIP Asset Management said in a report on the status of large shareholdings that it lowered its equity stake in Asia Holdings to 10.61% from 11.81%.
In particular, the purpose of the holding was also changed. It was converted from a general investment purpose to a passive investment. Among equity holding purposes, general investment refers to active shareholder activities such as exercising voting rights or rights to subscribe to new shares without affecting management control, while passive investment means exercising only minimal shareholder rights unrelated to company management.
Asia Holdings is a holding company with Asia Cement and Asia Paper under its umbrella. The three Asia companies have long been cited as undervalued in share price, and as a result, active shareholder activism has continued over the past several years.
VIP Asset Management first secured more than 5% of Asia Holdings equity in Aug. 2021, then steadily increased its stake to 11.81% and changed its holding purpose to general investment to begin shareholder action. At Asia Cement, it also secured a 6.36% stake in Sept. of the same year and raised it to 7.66%.
Since then, it has sent several shareholder letters and, through meetings with management, has continuously demanded changes in shareholder-return policies. Before the shareholder-return campaign began, Asia Holdings' share price was in the 120,000 won range; it recently reached the 340,000 won range, rising more than 166%.
After the shareholder actions began, Asia Holdings started implementing shareholder-return policies by strengthening cash dividends and buying back and canceling treasury shares. In Dec. last year, Asia Holdings announced a two-year shareholder-return policy. It included plans to pay at least 5,600 won in annual cash dividends (including interim dividends) from this year through next year and to acquire at least 8 billion won annually. The dividend per share, which was 3,000 won in 2021, gradually increased to 5,330 won last year.
A VIP Asset Management official said, "Now, even without pressure, they are sufficiently active in shareholder returns," and added, "We changed it to a passive investment purpose because we did not think there was any need to hold it for a general investment purpose anymore."