Elliot Associates’ bid to stop the merger of two Samsung Group affiliates — a move that will assure a smooth leadership transition within the founding Lee family in the Korean conglomerate — just got more interesting.
On Tuesday, the New York-based activist hedge fund sought for a court injunction to stop Samsung Group’s holding company, Cheil Industries, from taking over one of the group’s affiliates, Samsung C&T, through an $8 billion all-shares offer, according to Reuters.
If the deal pushes through, the two firms would be merged and their stakes in other Samsung Group affiliates including Samsung Electronics, the world’s biggest smartphone maker, would be consolidated into a single entity controlled by Jay Y. Lee, and his sister, the report said.
The younger Lee is reportedly the successor to his father, Samsung Group chairman Lee Kun-hee, who suffered a heart attack in May last year, in the conglomerate.
But Elliot opposed Cheil’s takeover bid saying it was not fair nor in the best interest of Samsung C&T investors.
“Elliott has therefore taken the step today of commencing legal proceedings for an injunction against Samsung C&T and its directors in order to seek to prevent the proposed takeover from going ahead,” Reuters quoted a statement from the fund.
Photo credit: TechStage via Flickr