At Samsung C&T Corp’s shareholder meeting today, 69.5 per cent of votes were cast in favour of accepting a buyout offer from the parent group’s de facto holding company, Cheil Industries Inc.
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A South Korean appeals court on Thursday rejected the latest effort by United States hedge fund Elliott Associates to block the $8.0 billion merger of two Samsung affiliates.
For Samsung’s founding family, the move is a crucial step in consolidating control of the conglomerate.
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 argued that the takeover wilfully undervalued the C&T share price, at an unacceptable cost to its shareholders.
During the spat Elliott filed for two injunctions to stop the vote taking place.
The results pave the way for Samsung’s founding Lee family to tighten its grip over the nation’s largest conglomerate and extend Korea’s track record of repelling foreign corporate raiders.
The business empire’s ailing patriarch Lee Kun-hee has been hospitalized since May past year and his son Lee Jae-yong is assuming a bigger leadership role but lacks a significant stake in flagship company Samsung Electronics.
The merger topped the agenda of the C&T shareholder meeting that got underway at 9:30am (0030 GMT) with Samsung needing a two-thirds majority to push the merger through. Under its holding group, Cheil Industries, is a complex network of some 70 businesses, ranging from textiles to entertainment.
Elliott owns a 7.1% stake in Samsung C&T, and is widely expected to challenge the Samsung merger in court.
“
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”,
an Elliott spokesperson noted following the vote.
It is yet to see how big impact Samsung makes in Korea with its new mobile payment service.
A few stakeholders including Elliott stressed that the sales and asset value of Samsung C&T is either comparable or superior to Cheil.
Kang Dong-Ok, an activist representing small shareholders, accused Samsung of playing a “dirty game” – harassing shareholders at their homes and workplaces.
The DSME, the world’s third-largest shipbuilder, was estimated to have posted a couple of billion dollars of losses in the second quarter as the shipyard was forced to belatedly book losses from offshore plant orders, which had been dismissed by former executives to gain support from shareholders.
The shareholders of South Korean construction giant Samsung C&T have given their approval to a merger proposal with Cheil Industries.
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The company reportedly asked AP not to publish a story before the shareholders meeting, according to the news service. Samsung C&T – “construction and trade” – will stand at the head of all companies in a group whose interests range from life insurance to shipbuilding to biotechnology, among numerous other fields.
