http://www.koreatimes.co.kr/www/news/biz/2015/03/488_176054.html

Updated : 2015-03-27 17:40

Ascender loses fight against Infovine CEO

By Kim Jae-won

Ascender Capital, a Hong Kong-based hedge fund, failed to change the corporate governance of Infovine at the local information technology company’s shareholders’ meeting on Friday.
Infovine reappointed its CEO, Kwon Seong-jun, at the meeting despite opposition from Ascender, which has accused Kwon of harming minor shareholders’ interests. Ascender, which owns 3 percent of Infovine, said Kwon had enriched himself at the expense of all other shareholders by issuing bond warrants in August 2013. Major shareholders also rejected Ascender’s suggestion to appoint Won Ho-yeon as a statutory auditor of Infovine. Kwon is the largest shareholder of Infovine, owning a 26 percent stake.
Ascender said it was frustrated to see the results, but acknowledged that it led Infovine’s minor shareholders to work together.
“Although the results of today’s annual general meeting (AGM) were disappointing, this year’s AGM served as a milestone for minority shareholders in working toward a common goal of preventing Kwon and Infovine’s board of directors from bringing further harm to the corporate governance of Infovine,” Ascender said in a statement after the meeting.
The hedge fund said its voice and other minority shareholders had been heard at the meeting, and quoted an old saying, “A journey of a thousand miles must begin with the first step.”
Infovine said that it was satisfied with the meeting and vowed to pay dividends to shareholders regularly, though it could not do so this year.
“Foreign investors suggested a few things in the meeting, but they failed to draw big attention,” said Kim Kwan-young, an Infovine director. “We promised to pay shareholders dividends later
Conflicts between the foreign investor and the local company may continue because Ascender filed a criminal complaint against Kwon with police last month. Ascender accused Kwon of violating the Special Economic Law and the Capital Market Law by issuing bond warrants in August 2013 despite enjoying a strong financial standing with no need to raise additional cash.
Ascender said that Kwon arranged to receive 70 percent of the newly issued warrants at a deeply undervalued price, resulting in dilution for all other shareholders. No other shareholders were given the opportunity to participate in the issuance, according to the hedge fund