A man in Seoul walks past a branch of Hyundai Motor
Seoul - AFP
The patriarch of South Korea's Hyundai Motor group and his heir-apparent have raised $1.1 billion selling their stakes in its logistics arm, officials said Friday.
The group said chairman Chung Mong-Koo and his son and vice chairman Chung Eui-Sun sold 5.02 million shares through a block deal Thursday after calling off the sale last month. The shares were sold at 230,500 won each.
The sale helped the Chung family reduce its stake in Hyundai Glovis to 29.99 percent from 43.39 percent to comply with new anti-trust rules aimed at curbing intra-group transactions, it said.
The regulations target what the government regards as unfair transactions between affiliates of family-run conglomerates, or "chaebols" -- especially in cases where family members hold stakes larger than 30 percent.
Investors who backed away from the initial attempted sell-off last month, appeared to have been drawn in this time by a lower share price and an undertaking by Hyundai that there will be no further divestment in Glovis for the next two years.
Like other family-run conglomerates, Hyundai Motor, which along with its affiliate Kia Motors is the world's fifth-largest automaker, is seen as preparing for a generational power shift from the elder Chung to his 44-year-old son.
"The stake sale has nothing to do with it (ownership transfer)," a Hyundai spokesman told AFP, dismissing market speculation that the money could be used for paying inheritance taxes.
Glovis once served as the group's virtual holding company.