This photo, taken Jan. 5, 2022, shows Hyundai Motor Group Chairman Chung Euisun at the Consumer Electronics Show (CES) in Las Vegas. (Yonhap)
SEOUL, Jan. 5 (Korea Bizwire) — Hyundai Motor Group Chairman Chung Euisun and honorary group chief Chung Mong-koo sold their combined 10 percent stake in Hyundai Glovis to the global private equity firm Carlyle Group, the logistics unit of the group said Wednesday.
The junior Chung sold a 3.29 percent stake and his father unloaded a 6.71 percent interest in Hyundai Glovis at 163,000 won (US$136) per share through block trading, the company said in a regulatory filing.
The stake sale is valued at around 610 billion won.
The block sale made Carlyle Group the third-largest shareholder in Hyundai Glovis. Hyundai Motor Chairman Chung is the largest shareholder with 19.99 percent. His father has no stake in Glovis.
“The move is aimed at raising shareholders’ value and dispelling market uncertainty,” Hyundai Glovis said.
Shares of Hyundai Glovis closed at 173,000 won on the main bourse on Wednesday, unchanged from the previous session.
Industry watchers said the stake sale seemed aimed at coping with the antitrust regulator’s strengthened rules on inter-affiliate trading by large companies.
The revised fair trade act, effective since Dec. 30, forbids inter-affiliate trading within a business group whose chief and owner family hold 20 percent or more of the shares in an affiliate. Previously, the threshold was 30 percent for listed large firms.
This file photo provided by Hyundai Motor Group shows Hyundai Motor and Kia’s headquarters buildings in Yangjae, southern Seoul.
Some experts said with the latest stake sale, Chung appears to have secured ammunition to prepare to overhaul the automotive group’s governance structure.
In 2018, Hyundai Motor Group announced that its auto parts supplier, Hyundai Mobis Co., will spin off its domestic module and after-sales parts businesses and merge them with Hyundai Glovis.
Afterward, the group owner family had a plan to buy stakes held by Kia, Hyundai Glovis and Hyundai Steel in Hyundai Mobis in a bid to cut off a cross-shareholding governance structure.
But global hedge fund Elliott and proxy advisers opposed the group’s overhaul plan at that time, demanding Hyundai Motor merge with Hyundai Mobis and the group adopt a holding firm structure.
Elliott held more than $1 billion worth of stocks in the group’s three key units — Hyundai Mobis, Hyundai Motor Co. and Kia Corp., previously named Kia Motors Corp. — before it sold all its stakes in them in early 2020.
Industry watchers said the group may again push to streamline its ownership structure this year.
They expect Chung and his father may seek to buy stakes in Hyundai Mobis to make it serve as a holding firm with the proceeds, estimated at 1 trillion won, from the latest block sale and Hyundai Engineering’s planned initial public offering.
(Yonhap)
