By Kim Da-ye
The fierce battle between Hyundai Group and Hyundai-Kia Automotive Group to take over Hyundai Engineering & Construction (HE&C) will drag on in next year as a Seoul court is expected to rule in early January whether it will accept the former’s request to keep its status as preferred bidder for the builder.
According to industry sources, the Seoul Central District Court is likely to make a decision on Jan. 4 after receiving relevant documents from creditors by Dec. 29. Creditors also told the court that they won’t begin negotiating with the automaker until Jan. 7.
Before HE&C’s creditors including Korea Exchange Bank (KEB) deprived Hyundai Group of its preferred bidder status on Dec. 20, the group had filed an injunction against the cancellation of the preliminary deal it signed with the bank.
If the court accepts the group’s request, the sale of HE&C will be suspended, tangled in lawsuits. Even if Hyundai Group regains its preferred bidder status, creditors have already voted not to sell their 34.88 percent stake to the company.
If the injunction is dismissed, creditors will proceed with negotiations with the automaker while attempting to mediate between the two rivals to help Hyundai Group defend its managerial rights in its flagship affiliate Hyundai Merchant Marine (HMM).
Hyundai Group desperately tried to acquire the builder partly because HE&C owns an 8.3 percent stake in Hyundai Merchant Marine. If Hyundai-Kia Automotive Group takes over HE&C, it is widely speculated that it will try and wrest control of HMM.
Hyundai Group last week rejected a suggestion by creditors to help retain control of HMM.
Ha Jong-sun, Hyundai Group’s president for strategic planning and development, said in a statement, “It is a suggestion that ignores the board of directors, minority shareholders and major shareholders of HE&C. We cannot accept a plan that doesn’t make legal sense.”