By Yoon Ja-young
Kia Motors reappointed a board member opposed by the National Pension Fund (NPF) at a shareholders meeting Friday.
Clashes between conglomerates and the NPF are expected to continue as the fund is poised to intervene in management of companies as a major shareholder.
At the general shareholders’ meeting, the nation’s second-largest automaker passed the appointment of a vice chairman and a vice president. It also decided to reappoint Kim Won-joon, a former ranking official at the Fair Trade Commission, as an outside director.
The pension fund, which is Kia’s second-largest shareholder with about a 7 percent stake, however, said that it opposed the reappointment of Kim, citing Hyundai Motor Group’s recent controversial land purchase.
Hyundai Motor consortium, including Kia Motors, offered 10.5 trillion won to purchase land from the state-run Korea Electric Power Corp. in September, raising concerns over the deal.
The NPF determined that Kim didn’t fulfill his responsibility of checking management.
It also disapproved of the appointment of an outside director at Hyundai Mobis, which is included in the Hyundai Motor consortium. However, both were reappointed at the meeting.
The pension fund has stated that it will actively exercise its voting rights at shareholders’ meetings to enhance shareholder value.
According to CEO Score, a conglomerate research firm, the state-run pension has a stake in 107 affiliates of the country’s top 30 conglomerates. The NPF has a bigger stake than the owner families in 64 of those. In the case of Kia Motors, the pension fund holds a 7.04 percent stake, bigger than the shares held by Hyundai Motor Group Chairman Chung Mong-koo or his son Eui-sun, the vice chairman.
The pension fund voted against 9 percent of the agenda at shareholders’ meetings last year, and succeeded in aborting the merger between Samsung Heavy Industries and Samsung Engineering.
Meanwhile, Kia Motors revealed plans regarding its hybrid cars and factory in Monterrey, Mexico, Friday.
“Despite unfavorable market condition, Kia Motors set a sales target of 3.15 million this year, around 100,000 more than last year,” said Lee Hyoung-keun, vice chairman of the company.
He said the company will successfully launch new cars to succeed the K5 and Sportage, continuing the good sales trend of the Carnival and Sorento.
“We will aggressively push for the launch of hybrid cars and a plug-in hybrid electric vehicle next year, on top of completing the factory in Monterrey, which has a production capacity of 300,000 a year,” he added.