Domestic activist-minded asset managers posted large cash gains from dividends last year, helped by rising share prices at companies they targeted. Align Partners, known for aggressive activism, paid out more than 15 billion won in dividends that effectively went to its sole owner, industry officials said.
According to the financial investment industry on the 30th, Align Partners paid 15.1 billion won in cash dividends out of about 23.9 billion won in net profit last year, a payout ratio of 63%. The dividend went to one person through the firm’s ownership structure. Align Partners’ largest shareholder is Align Holdings, which owns 100% of the asset manager. Align Holdings, in turn, is wholly owned by CEO Lee Chang-hwan, meaning the full 15.1 billion won dividend ultimately accrued to Lee.
Lee’s dividend stands out even among other activist-oriented managers. KCGI Asset Management, known in the past as the “Kang Seong-bu fund,” paid out all of its 6 billion won in net profit last year as cash dividends, a 100% payout ratio. KCGI holds 60% of KCGI Asset Management and HS Hwasung holds 40%, so about 3.6 billion won went to KCGI and about 2.4 billion won to HS Hwasung. KCGI’s largest shareholder is CEO Kang Seong-bu and related parties, who hold about 64%. Based on that, the dividend taken by Kang and related parties is estimated at about 2.3 billion won.
Truston Asset Management, another activist fund manager, paid about 4.1 billion won in cash dividends through its year-end payout out of roughly 17.9 billion won in net profit. CEO Hwang Seong-taek is the largest shareholder with 50.3%, while the company holds 29.2% of its own shares and other minority shareholders about 20.5%. Based on his stake, Hwang’s dividend income is just under 2 billion won.
Industry officials said Align Partners’ status as a de facto one-man company helps explain the gap in dividend take. They also said Align Partners’ investment gains likely swelled as share prices rose at companies where it built stakes while pursuing activist campaigns.
Some in the industry have questioned the optics of Align Partners’ dividend structure. “Align Partners is unlisted and effectively a private company, so you can’t call it a problem that one controlling shareholder takes a high dividend,” one industry official said. “But it is worth thinking about the fact that the results created by demanding higher dividends and greater shareholder value from companies ultimately concentrate in the hands of the asset manager’s controlling shareholder.”
* This article has been translated by AI.
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