SEOUL: A South Korean court has ruled in favor of a proposed merger of two Samsung Group subsidiaries, rejecting a US hedge fund’s motion to stop the eight-billion-dollar acquisition.
US hedge fund Elliott had asked for a court injunction to stop Cheil Industries acquiring Samsung C&T Corp. through an all-stock deal, a move seen as an effort by Samsung’s founding Lee family to boost control over the conglomerate ahead of a generational power transfer.
“The court rejected the request from Elliott,” a court spokesman told AFP.
Elliott had filed two lawsuits, one of which called for a court order to prevent a Samsung shareholders’ meeting on July 17 to approve the proposed merger.
The hedge fund, which holds a 7.12 percent stake in Samsung C&T, said the terms of the proposed takeover by Cheil Industries “significantly undervalue” Samsung C&T shares.
But the Seoul Central District Court said in the ruling: “The merger ratio was calculated in accordance with relevant laws... and cannot be seen as unfair.”
The ratio of the merger is 0.35 Cheil Industries shares for each Samsung C&T share.
Elliott also said the merger proposal as presented by Samsung C&T’s management carried with it “very limited evidence of the claimed synergies and benefits.”
It argued it was instead aimed at facilitating a father-to-son power transfer of the powerful Samsung Group rather than acting in the interest of shareholders.
The court, however, ruled: “There is no evidence either that the merger is being pursued only for the interest of the Samsung Group’s family members, regardless of other shareholders’ interests.”
Cheil Industries, half of whose stock is controlled by the Lee family, has no direct stake in Samsung Electronics, one of the world’s largest IT companies.
But its acquisition of Samsung C&T would bring it the construction and trading arm’s 4.1 percent Samsung Electronics stakes.
Elliott expressed disappointment but vowed to continue its efforts to prevent the merger.
“While we are disappointed with the court’s decision, we continue to believe that the proposed merger is neither fair nor in the best interests of Samsung C&T’s shareholders,” the hedge fund said in a statement.
It added: “We will continue to seek to prevent the proposed merger from being consummated, and we urge all Samsung C&T shareholders to do the same.”
Elliott has the right to appeal the decision within a week, but the appeals court rarely overturns a lower court’s decision in such cases, experts say.
Samsung C&T welcomed the rulings and vowed to push through with the merger, calling it a “lawful” move that was in the interests of both companies’ shareholders.
Along with the two cases, Elliott also filed a separate case seeking a court injunction against Samsung C&T’s efforts to sell treasury shares to chemicals maker KCC Corp., which the hedge fund said was a move to bolster its hand in this month’s shareholders’ meeting.
The court has not yet reached a decision on that issue, but said it would rule before the July 17 meeting.
Samsung C&T on June 10 decided to sell all of its 8.99 million Treasury shares to KCC, seen as a friendly shareholder, in a move that would increase voting support for the merger to 19.75 percent from 13.99 percent.
Treasury shares are useless in voting as companies cannot vote for themselves.
Cheil is the de facto holding company for Samsung Group, a $270 billion business empire.
The family-run group, currently controlled by Lee Kun-Hee, has merged, broken out or newly listed some of its key units in recent years as he prepares to hand over the reins to his son, J.Y. Lee.
The Lee family controls the vast Samsung Group via a complex web of cross shareholdings between the group’s subsidiaries, including Samsung Electronics — the group’s flagship unit and the world’s top maker of smartphones and mobile phones.
Recent health problems concerning the senior Lee, currently bedridden after suffering a heart attack last year, prompted the group to step up restructuring efforts.
The group, comprised dozens of units ranging from electronics to hotels, earns collective revenues equal to around 20 percent of South Korea’s annual economic output.
Court rules in favor of Samsung subsidiaries’ merger
Court rules in favor of Samsung subsidiaries’ merger
Arab food and beverage sector draws $22bn in foreign investment over 2 decades: Dhaman
JEDDAH: Foreign investors committed about $22 billion to the Arab region’s food and beverage sector over the past two decades, backing 516 projects that generated roughly 93,000 jobs, according to a new sectoral report.
In its third food and beverage industry study for 2025, the Arab Investment and Export Credit Guarantee Corp., known as Dhaman, said the bulk of investment flowed to a handful of markets. Egypt, Saudi Arabia, the UAE, Morocco and Qatar attracted 421 projects — about 82 percent of the total — with capital expenditure exceeding $17 billion, or nearly four-fifths of overall investment.
Projects in those five countries accounted for around 71,000 jobs, representing 76 percent of total employment created by foreign direct investment in the sector over the 2003–2024 period, the report said, according to figures carried by the Kuwait News Agency.
“The US has been the region's top food and beverage investor over the past 22 years with 74 projects or 14 projects of the total, and Capex of approximately $4 billion or 18 percent of the total, creating more than 14,000 jobs,” KUNA reported.
Investment was also concentrated among a small group of multinational players. The sector’s top 10 foreign investors accounted for roughly 15 percent of projects, 32 percent of capital expenditure and 29 percent of newly created jobs.
Swiss food group Nestlé led in project count with 14 initiatives, while Ukrainian agribusiness firm NIBULON topped capital spending and job creation, investing $2 billion and generating around 6,000 jobs.
At the inter-Arab investment level, the report noted that 12 Arab countries invested in 108 projects, accounting for about 21 percent of total FDI projects in the sector over the past 22 years. These initiatives, carried out by 65 companies, involved $6.5 billion in capital expenditure, representing 30 percent of total FDI, and generated nearly 28,000 jobs.
The UAE led inter-Arab investments, accounting for 45 percent of total projects and 58 percent of total capital expenditure, the report added, according to KUNA.
The report also noted that the UAE, Saudi Arabia, Egypt, and Qatar topped the Arab ranking as the most attractive countries for investment in the sector in 2024, followed by Oman, Bahrain, Algeria, Morocco, and Kuwait.
Looking ahead, Dhaman expects consumer demand to continue rising. Food and non-alcoholic beverage sales across 16 Arab countries are projected to increase 8.6 percent to more than $430 billion by the end of 2025, equivalent to 4.2 percent of global sales, before exceeding $560 billion by 2029.
Sales are expected to remain highly concentrated geographically, with Egypt, Saudi Arabia, Algeria, the UAE and Iraq accounting for about 77 percent of the regional total. By product category, meat and poultry are forecast to lead with sales of about $106 billion, followed by cereals, pasta and baked goods at roughly $63 billion.
Average annual per capita spending on food and non-alcoholic beverages in the region is projected to rise 7.2 percent to more than $1,845 by the end of 2025, approaching the global average, and to reach about $2,255 by 2029. Household spending on these products is expected to represent 25.8 percent of total expenditure in 13 Arab countries, above the global average of 24.2 percent.
Arab external trade in food and beverages grew more than 15 percent in 2024 to $195 billion, with exports rising 18 percent to $56 billion and imports increasing 14 percent to $139 billion. Brazil was the largest foreign supplier to the region, exporting $16.5 billion worth of products, while Saudi Arabia ranked as the top Arab exporter at $6.6 billion.
