(ATTN: ADDS Hyundai’s response in 4th para)
SEOUL, April 4 (Yonhap) — Elliott Advisors Ltd., a unit of U.S. activist hedge fund Elliott Management Corp., said Wednesday it has acquired more than US$1 billion worth of stocks in three major affiliates of Hyundai Motor Group, and asked for more efforts to improve corporate governance by the firms.
Citing Hyundai’s plan to streamline its complicated cross-shareholding structure through business spinoffs and mergers, Elliott Advisors welcomed the move as a first step towards an improved and more sustainable corporate structure.
“While this step is encouraging, more needs to be done to benefit the companies and stakeholders,” Elliott said in a statement, calling for a detailed road map to further enhance the South Korean auto giant’s governance structure.
In response, Hyundai Motor Group said in a statement that it will continue to make efforts to enhance shareholders’ value and the worth of its companies.
“The group is committed to better communicating with our shareholders to achieve these goals.”
Last week, Hyundai Motor Group announced that auto parts supplier Hyundai Mobis Co. will spin off its domestic module and after-sales parts businesses and merge them with logistics affiliate Hyundai Glovis Co.
After the spinoff and merger, Hyundai Mobis plans to focus on further beefing up its core auto parts operations and R&D business and developing future growth drivers like autonomous vehicles and connected cars.
Moreover, large shareholders, such as Hyundai Motor Group Chairman Chung Mong-koo and his heir apparent Vice Chairman Chung Eui-sun, plan to acquire all Hyundai Mobis shares held by Kia Motors Corp., Hyundai Glovis and Hyundai Steel Co. to simplify the group’s governance structure.
Kia, Hyundai Glovis and Hyundai Steel currently own 16.9 percent, 0.7 percent and 5.7 percent stakes, respectively, in Hyundai Mobis.
The move comes after the country’s antitrust regulator asked the group to come up with a concrete plan to overhaul its complicated shareholding structure among affiliates by the end of March.
All the plans are subject to approval at Hyundai Mobis and Hyundai Glovis general shareholder meetings scheduled for May 29.
(END)