[THE INVESTOR] Swiss elevator manufacturer Schindler Group, which is the second-largest shareholder of Hyundai Elevator, has launched a legal claim seeking at least 300 billion won (US$264 million) from the Korean government as compensation for damages over its approval of paid-in capital increase of the Korean lift maker from 2013 to 2015.
The Ministry of Justice on July 19 said Schindler submitted a notice of intent seeking a resolution through the investor-state dispute settlement mechanism. This means if the Korean government cannot settle the matter within six months, the investor can proceed with the lawsuit.
Schindler, which holds a 15.87 percent stake in Hyundai Group’s lift unit, claims the Financial Supervisory Service illegally approved Hyundai’s paid-in capital raise, which inflicted financial damages on investors.
In 2013, Hyundai raised 96.9 billion won by public offering, followed by 190 billion won in 2014 and another 270 billion won in 2015. Schindler had voted against on all the occasions, saying the scheme was to strengthen the grip of the owner family’s management at the cost of shareholders’ interest.
Since then, Schindler has filed several lawsuits against Hyundai but lost all the cases.
An official of the FSS said it is preparing to resolve the matter through settlement with Schindler.
The complaint came amid growing ISD claims against the Korean government for its involvement with conglomerates here. Global activist hedge funds Elliott Management and Mason Capital Management lodged an ISD lawsuit in April and June, respectively, for its approval of a controversial merger between two Samsung affiliates three years ago.
By Ahn Sung-mi (firstname.lastname@example.org)