May 05, 2024

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[THE INVESTOR] Revenue of Hyundai Glovis, the logistics arm of Hyundai Motor Group, is expected to double to 30 trillion won (US$28.20 billion) following a governance overhaul at the conglomerate this year, according to analysts on March 29. 

As part of the recently announced shakeup, Glovis will take two of Hyundai Mobis’ lucrative divisions -- module manufacturing and after-sales. Analysts estimate that Glovis’ revenue will likely expand from 16.36 trillion won to 30.37 trillion won. Pre-tax profit will soar to 2.33 trillion won, in comparison to 890 billion won. In addition, total assets will come to 13.63 trillion won, up from 7.08 trillion won. 

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Mobis shareholders will receive 0.61 new Glovis shares for each Mobis share. Mobis, the largest shareholder of Hyundai Motor with a near 7 percent stake, will become the central nerve of the automaker to focus on developing technologies and deploying equity investments and acquisitions.

The spin-off merger, which was devised to streamline Hyundai’s complex ownership structure on persistent calls from the Fair Trade Commission, needs the approval of shareholders of both firms on May 29. If approved, the change will go into effect by early July. 

Shares of Hyundai Glovis closed at 182,000 won, up 4.9 percent from the previous day. 

By Ahn Sung-mi (sahn@heraldcorp.com)