Hedge fund acquires 7.12% stake in Samsung C&T Corp.

Elliott Associates LP, an activist hedge fund from the U.S., has acquired a 7.12% stake in Samsung C&T Corp.,

the

Wall Street Journal

reported.

Samsung C&T operates in construction and trading.

Cheil Industries Inc., “the Samsung Group's de facto holding company,” is planning to take over Samsung C&T. Elliot said in a statement that the proposed takeover is not in the best interest of Samsung C&T shareholders, the


Journal


reported.

“Cheil operates South Korea's largest amusement park as well as fashion and construction businesses. It is seen as the conglomerate's de facto holding firm because of the Lee family's high ownership stake in the company,” the


Journal


explained.

Analysts say the planned transaction is an attempt by the Lee family, who control Smasung, to tighten its grip on units in the conglomerate before heir apparent Jay Y. Lee succeeds his ailing father. The Lee family directly owns 42% of Cheil, and Samsung affiliates own about 30%. The Lee family, their affiliates and treasury shares combined own less than 20% of Samsung C&T, the article said.

“Elliott's move, disclosed in a filing with South Korean regulators, could increase the pressure on Cheil Industries … to improve on its offer for the construction and trading affiliate,” the


Journal


report said. (Source:


Wall Street Journal


, June 4, 2015.)