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Elliott Takes on Korea Inc. Again With $1 Billion Hyundai Stake
Elliott Management Corp., the sometimes-activist fund run by billionaire Paul Singer, said it owns more than a $1 billion stake in several Hyundai Motor Group entities and is calling for a clearer road map as to how it will improve operations.
Elliott Management Corp., the sometimes-activist fund run by billionaire Paul Singer, said it owns more than a $1 billion stake in several Hyundai Motor Group entities and is calling for a clearer road map as to how it will improve operations.
The New York-based hedge fund said in a statement it’s encouraged that the South Korean automotive group had taken its first steps toward an improved and more sustainable corporate structure. The family-run conglomerate, known in South Korea as a chaebol, streamlined its ownership structure last month after drawing criticism from corporate-governance activists for years.
“While this step is encouraging, more needs to be done to benefit the companies and stakeholders,” the firm said in the statement. “Elliott calls on management to share a more detailed road map as to how it will improve corporate governance, optimize balance sheets, and enhance capital returns at each of the companies.”
Elliott said it’s looking forward to meeting with management and other stakeholders about the group’s issues and to offering recommendations about its proposed plan. The firm has waged a years-long activist campaign recently against another Korea Inc. giant, technology group Samsung Electronics Co.
Hyundai has been struggling in China, the world’s biggest auto market, amid a consumer backlash over political tensions between the country and South Korea. Sales also have been slipping in the U.S. due to a dearth of the sport utility vehicles American consumers are demanding at the expense of sedans.
Elliott said its holdings were in parts maker Hyundai Mobis Co. and car manufacturers Hyundai Motor Co. and Kia Motors Corp.
A representative for Elliott declined to comment further. A spokesman for Hyundai wasn’t immediately available for comment.
— With assistance by Craig Trudell