Kumho Petrochemical Chairman Park Chan-koo / Korea Times file

By Park Jae-hyuk

Kumho Petrochemical's board of directors offered to pay record-high dividends of 10,000 won ($8) per ordinary share and 10,050 won per preferred stock, in an apparent attempt to convince its shareholders to side with its chairman against his nephew once again, in their ongoing conflict over control of the company, according to its regulatory filing, Wednesday.

The petrochemical firm paid dividends of 4,200 won per ordinary share and 4,250 won per preferred stock last year, but it decided to double them this year, citing its record 2.4 trillion won annual operating profit in 2021 which recorded a 224.3 percent increase from a year earlier.

In addition, the company promised to repurchase its stocks worth 150 billion won to retire them eventually. Retirement of shares can raise earnings per share as it reduces the number of outstanding stocks.

"Amid our efforts for ESG management and sustainable growth, we decided to pay the record dividends and repurchase our shares to retire them," Kumho Petrochemical CEO Baek Jong-hoon said in a press release. "We will continue our shareholder return policies to enhance our shareholder value."

Former Kumho Petrochemical Senior Vice President Park Chul-whan speaks during a press conference at the Westin Josun Seoul in this March 2021 file photo. Yonhap

Its recent announcement was made a month after former Senior Vice President Park Chul-whan, the single largest shareholder of Kumho Petrochemical with an 8.5 percent stake, resumed his efforts to wrestle control of the company away from his uncle, Chairman Park Chan-koo.

The younger Park demanded payment of 14,900 won per ordinary share and 14,950 won per preferred stocks in dividends, which the company's management claimed were unreasonable requests.

He also recommended former Shinhan DS CEO Sunny Yi and KDI School of Public Policy and Management professor Hahm Sang-moon as successors for Kumho Petrochemical's two nonexecutive directors, whose terms will end later this year.

The petrochemical firm's management, on the other hand, recommended Kyung Hee University professor Park Sang-soo and Park Young-woo, director of Ecomom Korea, a non-governmental organization specializing in environmental studies.

During the previous proxy season last year, the nephew failed in his attempt to be appointed as the company's executive director and to receive bigger dividends. After he lost to his uncle in the general meeting of shareholders last March, he was dismissed from his position as the executive in charge of overseas synthetic rubber sales.

The uncle also stepped away from management last year, entrusting his company to a professional manager. However, his two children were promoted to higher positions last June, causing speculation about managerial succession.