(Reuters) - Elliott Management Corp renewed calls on Hyundai Motor Group last month to make structural changes, a source told Reuters, months after the U.S. activist fund helped force the South Korean automotive company to scrap a restructuring deal.
Hyundai Motor, South Korea’s second-biggest conglomerate, said in May it would “supplement and improve” a plan to streamline its complex ownership structure, reduce regulatory risk and prepare the group for a switch of management from father to son.
This came after opposition from Elliott against Hyundai Motor's original restructuring plan and growing public scrutiny over families controlling large conglomerates following a corruption scandal last year involving the Samsung Group.
In its fresh proposal, made in August, Billionaire Paul Singer's fund has asked car-parts maker Hyundai Mobis Co.<012330.KS> to sell its lucrative after-sale service business to affiliate Hyundai Motor Co. <005380.KS>, and then merge what is left of Mobis with logistics affiliate Hyundai Glovis Co <086280.KS>, backed by Hyundai's family members.
The proposal was first reported by Bloomberg.
The new proposal is in line with Elliott's initial call made in April.
Elliott declined to comment for the story.
A Hyundai representative declined to comment on whether it has received a fresh proposal, but said in a statement, "We hope to share our thoughts on how to improve shareholder value with all of our shareholders in due course.”
(Reporting by Liana B. Baker in New York and Ankit Ajmera in Bengaluru; Additional reporting by Hyunjoo Jin in SEOUL; Editing by Sriraj Kalluvila and Frances Kerry)