Chung now director at Kia, more votes soonHyundai Motor Group scion Euisun Chung was appointed as a director of Kia Motors on Friday, bolstering his position in the auto group ahead of a major shareholder vote next week that will decide his role in the group.
At a Kia Motors shareholders’ meeting Friday, Chung was voted in as a full-time director at the company from his position as a part-time director.
The vote comes just ahead of Hyundai Motor and Hyundai Mobis shareholders’ meetings, both scheduled on March 22. At the Hyundai Motor meeting, shareholders will vote to reappoint him as director.
The move is widely seen as part of Chung’s succession plans as his father and group chairman, Chung Mong-koo, stepped away from direct management.
Euisun Chung may be made CEO of Hyundai Motor and Hyundai Mobis next week, according to the Center for Good Corporate Governance.
The younger Chung, who was appointed as the group’s executive vice chairman in September last year, faces a battle with New York-based activist hedge fund Elliott Management.
Elliott has criticized Hyundai Motor’s governance structure and called for more transparency, nominating outside directors for the shareholder vote next week. The hedge fund, which owns a large stake in the group, has requested one-time dividends totaling 7 trillion won ($6.2 billion) from Hyundai Motor and Hyundai Mobis.
Hyundai Motor has received support from Korea’s National Pension Service, which said it would not vote for Elliott’s proposals.
Proxy advisory firms Glass Lewis and the Institutional Shareholder Services (ISS) advised against Elliott’s dividend calls.
The Friday vote increased Kia Motors’ annual dividend to 900 won per share, up 100 won from the previous year and reduced the salaries of directors by 20 percent.
BY CHAE YUN-HWAN [firstname.lastname@example.org]