SC Fundamentals has reportedly demanded that GS Home Shopping expand cash dividends and buy back 10 percent of its shares.

On the 15th, according to industry sources, SC Fundamental's domestic agent, Hanbyul Law Firm, applied to GS Home Shopping for access to the shareholder list and registration, and contacted major shareholders, including foreign funds, to secure a favorable stake.

SC Fundamental, a termination fund established in 1980, manages assets worth 1 trillion won and holds shares worth more than 100 billion won in Korea, including GS Home Shopping. SC Fundamental recently invested in TV Home Shopping's new facility investment, reportedly arguing that the cash should be returned to shareholders, citing the reason that it does not cost much.

GS Home Shopping is unwilling to accept this demand.

GS Home Shopping argues that it already pays one of the highest dividends in the industry. In fact, GS Home Shopping distributes 42% of its annual net profit to shareholders, even though the company suffered from the MERS outbreak and the Baeksuo controversy last year. The propensity is 42%. It is difficult to accept the SC fundamental demand as much as it is every year. In fact, GS Home Shopping's performance deteriorated significantly last year due to the MERS and SARS crisis, but its dividend payout ratio reached 42%. That is, it returned 42% of its annual net profit to shareholders. SC Fundamentals demanded a dividend of more than 80% from GS Home Shopping."

An official from GS Home Shopping said, "TV home shopping does not require new facility investment, but overseasbusiness and the mobile sector will continue to require investment," he said, adding, "It will be in the long-term interest of shareholders to increase corporate value through new growth businesses rather than expanding dividends in the short term."

Mi Young Park mypark@dt.co.kr