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Elliott Management will focus on the upcoming Hyundai restructuring to drive change at the automaker, after the activist hedge fund failed in its latest attempt to secure a higher dividend and governance changes in the second largest South Korean company.
The shareholders of Hyundai Motor and its spare parts affiliate Hyundai Mobis on Friday rejected Elliott's proposals to increase shareholder returns and install new outside directors. The vote is Elliott's latest blow in his long struggle to extract more value from the chaebol of South Korea, the family-related conglomerates that dominate the Korean economy.
The fund, based in New York, had requested special dividends worth about 6 trillion won ($ 6.2 billion) and the appointment of new directors to corporate boards to resolve excess capital and governance issues mentioned.
At a meeting in Seoul on Friday, shareholders, including the National Pension Service of South Korea, Hyundai's second largest shareholder, voted for nominations of members instead. of the Hyundai Board of Directors and for the stability of dividends.
"Even though I did not like the dividend level proposed by Hyundai, Elliott's proposal is too excessive," said a retail investor at Friday's meeting.
However, Elliott, the world's largest activist hedge fund, has already set its sights on an impending restructuring proposal expected later this year by Chung Euisun, Hyundai's alleged heir, as his next opportunity to put pressure on favor of changes within the company, according to regulars. the question.
The fund, which has announced that it has approximately $ 1 billion worth of shares in Hyundai and its affiliates, said in a letter to shareholders before the vote on Friday that since 2014, Hyundai was "plagued by governance issues and had few mechanisms to hold management to account. "
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