South Korean pension fund deals blow to Elliott in Hyundai fight

SEOUL (Reuters) - Elliott Management received a potentially fatal blow in its proxy fight to shake up South Korea’s Hyundai Motor Group on Thursday when major shareholder the National Pension Service (NPS) said it would vote down the U.S. hedge fund’s proposals.

Elliott, founded by billionaire Paul Singer, has been battling to get South Korea’s No.2 conglomerate to return excess capital to shareholders and fix governance problems since May last year when it scuppered a restructuring plan. [L4N1RG5BG]

The fund has demanded 7 trillion won ($6.2 billion) in one-off dividend payments and seats on the boards of group companies Hyundai Motor and Hyundai Mobis, in proposals to be put to a shareholder vote on March 22. Hyundai has rejected the proposals.

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The U.S. fund however says that even after the payout, Hyundai’s net cash level will be in line with industry peers. Elliott has also raised concerns that Hyundai’s excess capital will be used to fund non-core projects, citing the group’s $10 billion investment in land for its headquarters in 2014.

link
https://www.reuters.com/article/us-hyundai-motor-nps/south-korean-pension-fund-deals-blow-to-elliott-in-hyundai-fight-idUSKCN1QV0DO

Excess capital

Typical Hedge fund/republikkan thinking... You have excess money (rainy day fund, capital improvements, etc)... No. Spend it immediately