– Shareholders in South Korea’s Samsung C&T on July 17 narrowly voted through an all-share merger with Cheil Industries, the effective holding company for the Lee family that controls the Samsung Group.
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At an often-heated shareholder meeting, investors in builder Samsung C&T approved an all-share takeover offer from sister firm Cheil Industries, Samsung’s de facto holding company – but only just.
In the days leading up to the vote, investors opposing the deal-in South Korea and abroad-publicly said not enough consideration was given to how Samsung C&T shareholders would be affected. Elliott had said that the takeover deliberately underestimated share price of the C&T, at an objectionable value to its shareholders. No way was a USA hedge fund, for all the logic of its arguments, the skills of its lawyers and the tenacity of its campaign, going to block mighty Samsung from having its way on Samsung’s native turf.
“Samsung and the Lee family have always been engaged in a decade-plus of maneuvering with a simple goal of transferring share ownership and control over various Samsung Group companies to the next-generation Lee family”, Bernstein analysts wrote in a research note.
The business empire’s patriarch Lee Kun-hee has been in hospital since May 2014 and his son Lee Jae-yong is to take a bigger leadership role.
“
Elliott is disappointed that the takeover appears to have been approved against the wishes of so many independent shareholders and reserves all options at its disposal”,
a company spokesman said.
But a South Korean court rejected its case.
Korean customers using Samsung Galaxy S6 and S6 edge mobile devices will be the first to have access to the new digital payment app, the company said in a blog post, adding that Samsung Pay will be the most widely accepted mobile payment service in stores throughout Korea.
Samsung C&T Corporation, established in 1938, is the original company of the Samsung Group and now consists of the engineering and construction, and trading and investment groups.
The world’s largest smartphone manufacturer was given approval by shareholders of Samsung C&T today (July 17th). The merger was meant to provide Lee Jae-yong a solid grip on SAMSUNG ELECT LTD(F) (OTCMKTS:SSNLF), which is considered to be the crown of a jewel.
A C&T official said the merged entity will do its best to reflect shareholders’ interests. “Usually they don’t like to be in a spotlight but Elliott is viewed as a typical vulture fund trying to get a quick capital appreciation and from NPS’s perspective, it is protecting one of Korea Inc’s companies”, said one senior Seoul-based banker, who did not advise on the deal.
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As reported by C&T chief executive Choi Chi-Hun, “I am grateful for the shareholders who voted for the merger”. A two-thirds majority of the votes present is required for the almost $8 billion merger to pass. Foreign shareholders own roughly 30%, while Korean retail investors hold approximately 25%, according to an analysis by the Wall Street Journal.
