LG 2003 Annual Report Download - page 103

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LG Electronics Inc._Annual Report 2003 103
Notes to Non-Consolidated Financial Statements
For the years ended December 31, 2003 and 2002
30. Spin-Off
Upon a resolution of the Board of Directors on November 15, 2001 and a resolution of the shareholders on
December 28, 2001, the Company was spun off from LG Electronics Investment Ltd. on April 1, 2002. On April 2,
2002, the Company completed the registration process required for new companies, in accordance with the
Commercial Code of the Republic of Korea. In addition, on March 1, 2003, LG Electronics Investment Ltd. was
legally merged into LG Chem Investment Ltd. (LGCI), which changed its name into LG Corp. after the merger.
In accordance with the provisions in the Commercial Code Article No. 530-2, LG Electronics Investment Ltd.
established the Company to engage in the electronics and information and communications businesses.
The Company issued shares within the amount of net assets, which is the difference between the transferred
assets and liabilities, and the shares were distributed to the shareholders of LG Electronics Investment Ltd. in
proportion to their shares.
Accrued severance liabilities for employees working for the Company were transferred effective April 1, 2002.
The Company and LG Corp. jointly and severally hold a guarantee for the obligations before the spin-off.
Condensed financial information as of April 1, 2002 of the two companies after the spin-off is as follows:
(in millions of Won)
Post spin-off
Prior to spin-off LG Electronics Investment Ltd. LG Electronics Inc.
Assets ￦11,982,532 ￦2,972,213 ￦9,443,488
Liabilities 7,514,855 887,074 6,627,781
Equity 4,467,677 2,085,139 2,815,707
Depositary receipts (4,383,591 shares of non-voting preferred stock) which were transferred to the Company
upon the spin-off were listed on the London Exchange in September 2002.