Hyundai Motor, South Korea’s leading automotive company, on Friday officially denied a local news report that it is planning to convert into a holding company next week.
Local news outlet Maeil Business Newspaper had reported that Hyundai Motor Group will hold a board member meeting next week to introduce a holding company structure.
“The report that Hyundai Motor will convert into a holding company next week is not true,” said the spokesperson of Hyundai Motor Group.
Following Hyundai’s official denial made through regulatory filings, the stock price of Hyundai Motor dropped in the morning, but rebounded in the afternoon on expectations the company will still make structural changes in the near future.
A day earlier on Thursday, the stock price of Hyundai Motor and its affiliates rose on market expectations for a holding company transition in light of the Moon administration’s drive on chaebol reform, particularly on the country‘s big four conglomerates -- Samsung, Hyundai Motor, SK and LG.
On Wednesday, Moon appointed anti-chaebol scholar Kim Sang-jo as the new chief of the Fair Trade Commission signaling a determined message for reform of the big conglomerates.
“Hyundai Motor is the only group in which the cross-sharing structure is key to management control and succession,” Kim said in his press conference on Thursday.
Hyundai Motor Group has a cross-sharing structure in which the auto parts supplier Hyundai Mobis owns 20.8 percent shares of Hyundai Motor. Hyundai Motor has a 33.8 percent stake in its sister affiliate Kia Motors, which holds 16.9 percent of Hyundai Mobis.
“It is projected that Hyundai Motor Group will speed up restructuring the company due to the administration’s chaebol reform,” said Yoon Tae-ho, an analyst of Korea Investment & Securities.