SKorea probes British pension fund<\/p>\n
Agence France-Presse, Seoul<\/p>\n
South Korea's financial watchdog is looking into allegations
\nthat British pension fund Hermes Investment Management violated
\nstock market rules, officials said on Thursday.<\/p>\n
Hermes came under fire this month after it sold a five percent
\nstake in Samsung Corp., the trading arm of South Korea's largest
\nconglomerate Samsung Group, sparking a fall in the stock.<\/p>\n
The sale on Dec. 3 came just days after Robert Clements,
\ndirector of the fund's emerging market management, told a South
\nKorean newspaper that Samsung Corp. could become the target of a
\nhostile takeover by foreign investors if it failed to improve
\ncorporate governance.<\/p>\n
The stock price rose to 15,850 won (US$14.9) following
\nClements' remarks but fell sharply after the fund then sold its
\nstake in Samsung Corp.<\/p>\n
South Korean investors have since accused Hermes of
\nmanipulating stock prices.<\/p>\n
"We are studying whether the case is in violation of stock
\nmarket rules banning the spread of false information or rumors in
\norder to talk up stock prices," a senior Financial Supervisory
\nService official told AFP.<\/p>\n
"If anything is found suspicious, we will launch a formal
\nprobe."<\/p>\n
Stock market authorities said Hermes bought five percent of
\nSamsung Corp. shares in March for investment purposes, becoming
\nthe single biggest foreign investor in the company.<\/p>\n
On Nov. 12, Hermes said it had discussions with Samsung
\nCorp.'s management on matters that included the "strategic
\nrelevance" of Samsung Corp.'s stake in Samsung Electronics and
\nthe level of future dividends.<\/p>\n
Samsung Corp. owns about four percent of Samsung Electronics,
\nthe world's largest chip company.<\/p>\n
"In addition we did discuss the vulnerability of the company
\nto a hostile bid approach if it did not take action to address
\nthe above issues," Hermes said in a statement.<\/p>\n
The statement and Clements' subsequent interview on Dec. 1
\nprompted retail investors to buy Samsung Corp. shares.<\/p>\n
South Korean law provides for heavy fines and lengthy jail
\nterms for stock manipulation but there have been no cases
\ninvolving foreign investors.<\/p>\n
The latest development comes amid growing calls in South Korea
\nto curb the power of foreign investors, who have become major
\nplayers in many companies and in the stockmarket.<\/p>\n
The watchdog, however, said the Hermes case was unrelated to
\nsuch sentiment triggered by growing foreign holdings which now
\naccount for 43 percent of South Korean stocks, up from 40.7
\npercent a year ago.<\/p>\n
Hermes manages about 94 trillion won of assets for pension
\nfunds, insurance companies and government agencies. It has also
\nsupported an attempt by Monaco-based Sovereign Asset Management
\nto oust SK Corp. chairman Chey Tae-Won.<\/p>\n
A South Korea court ruled in favor of the oil refiner on
\nMonday and rejected Sovereign's call for a special shareholders'
\nmeeting to vote on management.<\/p>\n
The Monaco-based fund, which holds a 14.9 percent stake in SK
\nCorp., insists shareholders should be allowed to vote on whether
\nto retain Chey, 42, who was sentenced last year to three years in
\nprison for irregular dealings and accounting aimed at tightening
\nhis control over SK Corp. and its parent SK Group, South Korea's
\nthird-largest family-run conglomerate.<\/p>\n
Chey was freed on bail pending an appeal and remains chairman
\nof SK Corp.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/skorea-probes-british-pension-fund-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}