Hyundai Motor chairman, Chung Mong-koo, and his vice-chairman son Chung Eui-sun, this week failed to sell over 5m shares worth some US$1.25bn in affiliated logistics company Hyundai Glovis to Seoul-based financial institutions.
The failed sale is seen as a setback in the succession plans in one of South Korea’s largest family owned conglomerates, known as chaebols. The 76-year old chairman is eventually expected to hands over the reigns of the family business to Eui-sun.
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It is believed that the sale would have funded equity purchases by Eui-sun in some of the core companies within Hyundai Motor group, including automotive component maker Hyundai Mobis.
Market analysts say the size of the stake for sale was one of the major concerns among institutional investors, even though they were offered at 12% below the previous day’s closing price.
Bringing the family’s stake in Hyundai Glovis to below 30% would free the company from antitrust scrutiny regarding inter-affiliate transactions.
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