Hyundai Motor Company is the fifth largest automaker in the world, and its operations are handled by more than 75,000 worldwide employees. There are 5,000 showrooms and dealerships in 193 countries where there are sold an average of 7.12 million units a year. In the presence of malicious rumors according to which the company is going to organize an ownership restructuring, Hyundai released its revenue numbers.
Market Speculations Point at a U.S. Hedge Fund Purchasing Hyundai Stocks
The South Korean president Park Geun-hye was recently caught in a major scandal involving several companies. As a consequence of this event, politicians are asking for a business reform. To combat this direction, Hyundai Motor Group, Samsung Group, and other conglomerates owned by families may unite their forces together in a holding company structure. Some of the consequences of this scandal resulted in the removal of Park from her presidential seat and Jay Y. Lee, Samsung Group leader, continues to participate in the trial.
On Tuesday, the market speculated that a U.S. activist hedge fund bought shares in Hyundai Motor Company. The company in question is Elliott Management Corp. Analysts are of the opinion that the hedge fund previously forced Samsung Electronics Co Ltd to pursue ownership restructuring and focus on dividends. The same might happen to Hyundai Motor.
The Hyundai Group Founder Didn’t Mention Ownership Restructuring Amid Birthday
On the other hand, some sources familiar to this matter described these rumors as meaningless. The automaker commented the situation by reinstating one of its business values which are that of not engaging in market speculations. However, Goldman Sachs interpreted a revenue report on Hyundai Motor released on Monday. According to the bank, the automaker is finding itself at a suboptimal point in its existence. Therefore, the company should reconsider the idea of an ownership restructuring.
Nonetheless, Hyundai Motor shares were at 8.6%, which marked its biggest daily gain since August 2011. Its affiliates didn’t stagnate either. Kia Motors Corp rose 3.5% while Hyundai Mobis Co Ltd increased by 3.1%. In the near future, the parliament is going to seek the empowering of institutional investors. On the other hand, the political theater will impose tougher rules on a holding company structure. Thus, family members will have to go to great length to restructure their businesses.
The founder of the Hyundai Groups of South Korea has just turned 79 years-old on Sunday. Despite these rumors, he refused to hand the reins of his company over to his only son, Chung Eui-sun. Therefore, Hyundai Motor Group is in no talks about major ownership restructuring.
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