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Wednesday, June 1, 2016, Jaistha 18, 1423 BS, Shaban 24, 1437 Hijri

S Korea court rules against Samsung in merger payout suit
Published :Wednesday, 1 June, 2016,  Time : 12:00 AM  View Count : 13

SEOUL, May 31: A South Korean appeals court ruled on Tuesday that a contested merger between two Samsung Group affiliates last year had short-changed minority shareholders, and said they should receive a bigger payout.
The Seoul High Court decision overturned a lower court ruling that had dismissed the shareholders' suit against the giant South Korean conglomerate.
The merger last July saw Samsung's de facto holding company, Cheil Industries, take over construction firm Samsung C&T in an all-stock deal worth an estimated $8.0 billion.
The merger had been passionately opposed by a significant number of C&T investors, rallied by US hedge fund Elliott Associates -- the company's second-largest single shareholder.
Elliott had argued that the takeover wilfully undervalued the C&T share price, at an unacceptable cost to its shareholders.
The High Court ruled that five shareholders who sued C&T for more money should be offered 66,602 won ($55.92) for each C&T share they held before the merger, compared with 57,234 won offered last year.
"The court's decision is inconsistent with the decisions in other related cases," Samsung said in a statement.
"After a thorough review of the court's rulings, we plan to file an appeal with the Supreme Court," it said.
Last year's merger was seen as crucial step for Samsung's founding Lee family in its effort to consolidate control of the giant, multi-headed conglomerate, ahead of a generational transfer of power from ailing patriarch Lee Kun-Hee.
Although the anti-merger camp lost the final vote, its muscular campaign marked a watershed moment for shareholder activism in South Korea -- where family-run conglomerates, or "chaebol," dominate the economy and are accustomed to run their businesses with minimum investor interference.     ?AFP

Editor : Iqbal Sobhan Chowdhury
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