By Kim Yoo-chul
The National Pension Fund (NPF), the country's biggest pension service operator, said Wednesday that Elliott Associates, an American hedge fund led by Paul Singer, may file a lawsuit against the service, seeking compensation.
"There is the possibility that Elliott Associates will ask for an investor-to-state display settlement (ISDS) in connection with NPS's support for the Samsung C&T and Cheil Industries merger deal," said an NPF official. "However, we have yet to receive an official complaint from Elliott Associates."
The ISDS is a special legal right that allows investors in a foreign country to challenge a law, regulation, judicial or administrative ruling, or any other government decision. Investors are those who buy asserts, whether it's property, a factory, stocks or bonds.
An ISDS allows the foreign property owner to skip domestic courts and administrative procedures and sue the targets before a panel of private arbitrators.
The NPF decision to support the merger was the key to closing the deal as it was the biggest shareholder of Samsung C&T.
Elliott Associates asked top Samsung management to revise the stock swap deal of 0.35:1 upwards, insisting the ratio significantly undervalued the common interests of C&T shareholders.
Elliott Associates demanded the NPF drop its support for the deal. But the merger was passed by shareholders after it declared its support for the plan, nullifying Elliott's attempts to block the deal.
"It's true that Elliott Associates strongly asked the NPF to vote against the announced plan. However, we voted yes after a thorough review," the NPF official said.
In March, NPS officials met with Elliott Associates to discuss the proposed Samsung deal. At that time, the NPF said it would not approve the merger; but changed its stance and voted for the deal after discussions with Samsung management.
The official said Elliott Associates asked the NPF to clarity its official stance about the C&T and Cheil deal "numerous times" since February, even before the plan was announced.
The NPF increased its holdings of Samsung C&T more than 10 percent since then. After the deal was approved, Elliott sold most of its shares in C&T. Its holdings of Samsung C&T remained at 0.63 percent as of September.
The National Pension Fund (NPF), the country's biggest pension service operator, said Wednesday that Elliott Associates, an American hedge fund led by Paul Singer, may file a lawsuit against the service, seeking compensation.
"There is the possibility that Elliott Associates will ask for an investor-to-state display settlement (ISDS) in connection with NPS's support for the Samsung C&T and Cheil Industries merger deal," said an NPF official. "However, we have yet to receive an official complaint from Elliott Associates."
The ISDS is a special legal right that allows investors in a foreign country to challenge a law, regulation, judicial or administrative ruling, or any other government decision. Investors are those who buy asserts, whether it's property, a factory, stocks or bonds.
An ISDS allows the foreign property owner to skip domestic courts and administrative procedures and sue the targets before a panel of private arbitrators.
The NPF decision to support the merger was the key to closing the deal as it was the biggest shareholder of Samsung C&T.
Elliott Associates asked top Samsung management to revise the stock swap deal of 0.35:1 upwards, insisting the ratio significantly undervalued the common interests of C&T shareholders.
Elliott Associates demanded the NPF drop its support for the deal. But the merger was passed by shareholders after it declared its support for the plan, nullifying Elliott's attempts to block the deal.
"It's true that Elliott Associates strongly asked the NPF to vote against the announced plan. However, we voted yes after a thorough review," the NPF official said.
In March, NPS officials met with Elliott Associates to discuss the proposed Samsung deal. At that time, the NPF said it would not approve the merger; but changed its stance and voted for the deal after discussions with Samsung management.
The official said Elliott Associates asked the NPF to clarity its official stance about the C&T and Cheil deal "numerous times" since February, even before the plan was announced.
The NPF increased its holdings of Samsung C&T more than 10 percent since then. After the deal was approved, Elliott sold most of its shares in C&T. Its holdings of Samsung C&T remained at 0.63 percent as of September.
