SK share price rise also contested

SK Group Chairman Chey Tae-won speaks at the Ecosystem Leadership Exchange in Seoul on Monday. [Social Value Connect]
SK Group Chairman Chey Tae-won speaks at the Ecosystem Leadership Exchange in Seoul on Monday. [Social Value Connect]

SK Group Chairman Chey Tae-won, 65, has challenged the 67-to-33 asset division ratio set by a retrial court in his divorce case against Noh So-young, 65, director of Art Center Nabi, sources said, as he appeals the ruling to the Supreme Court for a second time.

In a brief filed with the Supreme Court, which is hearing the second appeal in the asset division case, Chey's legal team argued that the retrial court's split of roughly 66.6 percent for Chey and 33.3 percent for Noh was inappropriate — even setting aside the question of former President Roh Tae-woo's alleged slush fund contributions, sources said.

Chey filed the second appeal in August after the Seoul High Court's retrial ruling ordered him to pay Noh 944 billion won ($706 million) in cash.

The Supreme Court overturned the second-instance ruling last October, finding that former President Roh's alleged 30 billion won slush fund should not have been factored into the asset division ratio.

The court reasoned that even if the funds existed and were transferred to SK, they constituted illegal money and could not be credited as Noh's contribution to the marital estate.

The retrial court, which convened in July, accordingly excluded the former president's alleged slush fund from its calculations but still recognized Noh's contribution share at 33 percent.

Chey's side argued this was unjust: despite the slush fund being excluded, Noh's share fell only slightly from the 35 percent the second-instance court had awarded before the case was remanded for retrial.

Chey's legal team also contested the retrial court's decision to factor a sharp rise in SK's share price into the asset division ratio.

At the close of arguments in the original second-instance proceedings, SK shares stood at 160,000 won, but by the time arguments concluded in the retrial, the price had climbed to around 800,000 won.

The retrial court said Supreme Court precedent required it to use the date arguments closed in the original second-instance proceedings — April 16, 2024 — as the valuation benchmark, but it nonetheless factored in the substantial share price increase on equity grounds when calculating the division ratio.

Chey's team is also expected to dispute which assets are subject to division, arguing that his stake in SK Siltron, acquired in 2017 after the marriage had broken down, should not be included.

Noh's side has not yet filed an incidental appeal. An incidental appeal allows the opposing party to challenge portions of the lower court ruling that are unfavorable to them once the other side has appealed. Noh's team has until Tuesday — the deadline for Chey's side to submit its appellate brief — to do so.

Meanwhile, Chey is selling 944 billion won worth of shares in SK Inc., the group's holding company, to prepare for the asset division payment.

Chey disclosed that on Oct. 2 he signed two sale contracts to dispose of a combined 1,653,924 common shares of SK Inc. Under the arrangement, 544 billion won worth will go to a strategic investor, while the remaining 400 billion won worth will be transferred to a securities firm, with profits and losses settled based on subsequent share price movements.

The Korea Corporate Governance Forum raised questions about Chey's motives for the sale, saying an explanation was needed as to whether it was intended to circumvent the "3 percent rule" ahead of next year's shareholders' meeting.


pink@heraldcorp.com