Hanwha Solutions issued a revised disclosure stating that it will reduce the size of its paid-in capital increase by 600 billion won, from 2.4 trillion won to 1.8 trillion won. Hanwha Group Chairman Kim Seung-yeon also said he will not receive a salary from Hanwha Solutions starting next month. The company announced this as a “shareholder value protection measure,” but minority shareholders gave a cool response, saying it was “within expectations.”

On the 17th, Hanwha Solutions announced via the electronic disclosure system that it had revised the number of new shares to be issued from 72 million to 56 million. This is a reduction of about 22% from the original plan. The issue price per new share was also adjusted from 33,300 won to 32,400 won. On a total amount basis, it decreased from 2.3976 trillion won to 1.8144 trillion won.

The amount earmarked for debt repayment, which had been controversial because the funds raised through the paid-in capital increase were known to be used mainly to repay ‘debt’, was reduced from 1.4899 trillion won to 906.7 billion won. Funds for facilities were maintained at 907.7 billion won.

In a separate statement the same day, Hanwha Solutions said it was a “measure to protect shareholder value and ease the funding burden by reflecting the diverse opinions of various shareholders and others.” The company said it aims to achieve two goals - investment in future technologies and improvement of its financial structure - even while reducing the size of the capital increase by 600 billion won.

At the same time, Nam Jeong-woon, head of the Hanwha Solutions Chemical division, and Park Seung-deok, head of the Qcells division, said, “We sincerely reflect on and apologize for having caused great concern by failing to communicate sufficiently with our shareholders and the market about the scale and background at the initial stage of promoting the paid-in capital increase.”

Hanwha Solutions plans to expand communication with investors, including by holding a briefing on the 21st for domestic securities firm analysts to explain the expected effects of the paid-in capital increase. In addition, Hanwha Group Chairman Kim Seung-yeon decided to manage without drawing a salary from Hanwha Solutions starting next month. Last year, Chairman Kim received remuneration of about 5.041 billion won from Hanwha Solutions.

However, the backlash from minority shareholders does not appear to be subsiding. Cheon Kyung-deuk, a representative of Hanwha Solutions minority shareholders, said in a call the same day, “There is too much debt, so shareholders are being asked to put in money, yet there is no acknowledgment or apology for mismanagement. This is not the kind of communication shareholders want,” adding, “We will compile shareholder demands such as restoring shareholder trust and ensuring the independence of outside directors and deliver them to the company.”

Earlier, on the 26th of last month, Hanwha Solutions abruptly announced a paid-in capital increase in which the amount of new shares to be issued came to about 42% of existing shares, facing strong backlash from existing shareholders concerned about dilution of equity value.

From the perspective of investor protection, the Financial Supervisory Service, which conducted a focused review of Hanwha Solutions securities registration statement, requested a correction from the company on the 9th. Hanwha Solutions submitted a corrected registration statement today, eight days after the correction request.

A Financial Supervisory Service official said the same day, “Now that the corrected registration statement has been submitted, we will review it thoroughly.”

Meanwhile, the Korea Exchange issued a preliminary notice of designation as an inadequate disclosure company for Hanwha Solutions, which changed the number of shares to be issued and the amount by more than 20% in the corrected filing today. The exchange stated, “We will re-disclose as soon as specific results, including whether to designate it as an inadequate disclosure company, are finalized.”