Hyundai Motor Scion Buys $418 Million Stake in Automakerby
Chung Eui Sun bought 3.16 million shares in Hyundai Motor
Hyundai Heavy Industries sold the stake to improve finances
Hyundai Motor Co.’s vice chairman increased his holdings in the carmaker as part of a move to protect the company’s share price and help a struggling family group-owned shipbuilder. Both stocks rose.
Chung Eui Sun on Thursday bought 3.16 million shares, or a 1.44 percent stake, in Hyundai Motor for 500 billion won ($418 million) from Hyundai Heavy Industries Co., according to a regulatory filing. The only son and heir apparent to Hyundai Motor Group’s 77-year-old chairman owned 6,445 shares in the group’s crown jewel before the purchase.
Hyundai Motor rose 2.5 percent to 162,000 won while Hyundai Heavy gained 2.6 percent at the close in Seoul trading. The benchmark Kospi index declined 0.2 percent.
Hyundai Heavy, part of the Hyundai Heavy Industries Group controlled by Chung’s uncle, sold the stake to improve its finances, the group said in a separate regulatory filing. Chung, 44, bought the stock to protect value for Hyundai Motor shareholders and ensure the stability of the business, Hyundai Motor said in an e-mailed response.
“Chung needed to expand his holding in the group’s key companies, including Hyundai Motor, and Hyundai Heavy needed the money, so you can say that everything fell into place quite nicely,” said Chae Yi Bai, an analyst at the Center for Good Corporate Governance, a Seoul-based corporate watchdog.
Hyundai Heavy is one of South Korea’s Big Three shipbuilders, along with Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co. The trio posted a combined 4.8 trillion won in operating losses in the quarter ending June 30, missing analysts’ estimates.