As we reported earlier that Cheil Industries has proposed an $8 Billion merger plan for two of the Samsung Group companies. Lately, U.S. Hedge Fund made a bid to block the vote of a shareholder on this planned merger.
However, this Wednesday, court rejected this bid in the favor of the merging plan, as proposed by Cheil Industries. This is being seen as one of the key steps, as the ownership of the Samsung Group of Companies is transferred to the heirs of the organization.
Elliott Associates, which owns 7.1% of the shares in Samsung C&T Corporations, also contends to the proposed all-stock offer by the Cheil Industries. According to Elliott Associates, Cheil Industries is taking an advantage of being Samsung Group’s de facto holding company, and is underestimating the value of Samsung C&T Corp.
This sacrifice would allow Samsung to secure their major affiliates, such as Samsung Electronics Co. and gain control, eventually again. The Court’s ruling in Seoul against the U.S. Hedge Fund was highly anticipated by many analysts, because all the terms and conditions of the investors were in compliance with the South Korean legislature. In this regard, Samsung C&T made a statement that the merger ratio is fair, and all the legal requirements are fulfilled.
The Samsung C&T shareholder vote is planned to be held on 17th July. Samsung Group of Companies and Cheil Industries, have suggested the shareholders to vote in favor of the takeover. However, some shareholders are clearly contending to the takeover as they are foreseeing a great loss if they will have to buy out the shares.