It’s 1-0 so far in favor of the Lee family in their fight with fund manager activist Elliot Associates on the proposed merger between two Samsung Group affiliates.
A South Korean court trashed the New-York based firm’s request to stop a shareholders meeting on July 17 that will include a vote on the merger between Samsung C&T and Cheil Industries, the group’s de facto holding company, according to Bloomberg.
The court has yet to rule on Elliott’s other petition to stop KCC Corp., an ally of the Lee family, from voting Samsung C&T treasury shares, the report said. The court said it would rule on the second petition before the Samsung C&T meeting.
Elliott has opposed the proposed merger between Samsung C&T and Cheil Industries that will be done through an all-stock offer by Cheil, saying the deal would be unfair to Samsung C&T shareholders and that it “significantly undervalues” Samsung C&T. Elliot has a 7.12% stake in Samsung C&T.
“There is no reason to say that the merger harms Samsung C&T and its shareholders while only benefiting Cheil and its shareholders alone, given that the share price of Samsung C&T rallied shortly after the merger was announced,” Bloomberg quoted a court statement on the ruling.
The merger will pave the way for Lee Jae Yong to succeed his ailing grandfather, who founded the conglomerate, as chairman.
Shares of Samsung C&T and Cheil rose after the court ruling, said Bloomberg.
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