By Kim Tae-gyu
AhnLab, the nation’s top anti-virus vaccine developer, has countered continued attacks by Rep. Kang Yong-seok on the issuance of bonds with warrants (BWs) to its founder Ahn Cheol-soo.
Contending that AhnLab offered BWs to Ahn at a much lower price than their market value in 1999, Kang filed a lawsuit earlier this month against the entrepreneur-turned-professor who is regarded as one of the top contenders in this year’s presidential election.
In response, AhnLab said the Seoul-based company issued the BWs in question at prices higher than those in evaluations after getting approval from the company’s shareholders.
“In the late 1990s ahead of the initial public offering (IPO), concerns ran high on the low stake of CEO Ahn whose management right was feared to end up being weakened due to the IPO,” an AhnLab official said.
“So we issued BWs to Ahn at 50,000 won per share for 130,000 shares, which was more than the outside consultant’s evaluation of 31,976 won. In addition, all details were ratified at the shareholders’ meeting.”
In 1999, Ahn held a 39.05 percent stake in AhnLab but the BWs jacked up his stake to 54.46 percent. The figure went down to 38.3 percent after the IPO.
BWs provide holders the right, but not obligation, to buy a certain number of securities at a pre-set price and time. The securities are typically common stocks of the BW issuer — in this case AhnLab.
Kang took issue with the fact that Ahn exercised the right at 1,710 won in late 2000, around a year before the IPO, in taking the 49-year-old info-tech mogul to court, arguing embezzlement and a breach of trust.
“In late 1999 and early 2000, we made a capital increase amounting to 1.25 billion won and split our shares at a ratio of roughly one to 10, which caused the execution price to fall from 50,000 won to 1,710 won a share,” the official said.
“All the measures were geared toward cranking up the number of shares in circulation so that our investors could make transactions without difficulty.”
She added that the case has nothing to do with a breach of trust, which requires two prerequisites — the lack of shareholders’ endorsement and the issuance of securities at prices higher than market norms.
“The BWs at issue were offered at higher prices than the market value and the measure was ratified by shareholders. As a result, breach of trust by no means holds up in this case,” she said.
With regard to some media reports that AhnLab underwent a police investigation in 2002 due to the BWs, the company said that the rumor was totally groundless.
In response to the request from investors to come up with official announcements early Monday on whether the company was under police scrutiny after Kang’s accusation, AhnLab responded, “We have never been investigated by the police in our history.”