Family Holdings in Korea's Top conglomerates Increase
Data from the Korean Stock Exchange and the Korea Listed Company Association suggest that the controlling families of Korea's largest conglomerates have significantly increased ownership in their companies over the past year.
Why?
Most experts agree that its is to defend family managerial control against the increasing chance of hostile takeover threats by foreign capital. ,
The Korea Exchange and the Korea Listed Companies Association notes that the holdings of the largest shareholders and closely related parties increased last year at the biggest conglomerates including Samsung Group, LG Group and Hyundai Motor Group.
The data suggests that a growing perception of takeover threats by foreign private equity funds, coupled with a series of government measures aimed at restricting the power of family-run conglomerates, or chaebol, have been the main reasons behind sagging corporate investment over the past couple of years.
Samsung Electronics Co., Korea's largest company by market value, saw the shareholdings of Chairman Lee Kun-hee and nine related parties and institutions rise to 25.43 percent at the end of the first quarter, up from 14.29 percent at the same period last year.
At Hyundai Motor Co., Korea's largest automaker, Chairman Chung Mong-koo and 20 aligned shareholders accounted for 28.96 percent in the first quarter, up nearly 4 percent from 25 percent a year earlier.
Korean lawmaker Chung Mong-joon, a brother of Chung and the largest shareholder of Hyundai Heavy Industries Co., also increased his control over the company. He and six closely related shareholders owned 37.93 percent, up 6.97 percent from a year ago.
Why?
Most experts agree that its is to defend family managerial control against the increasing chance of hostile takeover threats by foreign capital. ,
The Korea Exchange and the Korea Listed Companies Association notes that the holdings of the largest shareholders and closely related parties increased last year at the biggest conglomerates including Samsung Group, LG Group and Hyundai Motor Group.
The data suggests that a growing perception of takeover threats by foreign private equity funds, coupled with a series of government measures aimed at restricting the power of family-run conglomerates, or chaebol, have been the main reasons behind sagging corporate investment over the past couple of years.
Samsung Electronics Co., Korea's largest company by market value, saw the shareholdings of Chairman Lee Kun-hee and nine related parties and institutions rise to 25.43 percent at the end of the first quarter, up from 14.29 percent at the same period last year.
At Hyundai Motor Co., Korea's largest automaker, Chairman Chung Mong-koo and 20 aligned shareholders accounted for 28.96 percent in the first quarter, up nearly 4 percent from 25 percent a year earlier.
Korean lawmaker Chung Mong-joon, a brother of Chung and the largest shareholder of Hyundai Heavy Industries Co., also increased his control over the company. He and six closely related shareholders owned 37.93 percent, up 6.97 percent from a year ago.
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