National pension fund holds 5% stake in 62 listed companies

The state-run National Pension Fund (NPF), South Korea's largest institutional investor, holds at least a 5 percent stake of nearly 70 percent of the listed affiliates of the country's top 10 business groups, giving the firm voting power, financial data showed Sunday.

Out of the 89 affiliate companies of the 10 conglomerates, including Samsung Group and Hyundai Motor Group, NPS holds a 5 percent or more stake in 62 firms, according to the data compiled by the Financial Supervisory Service.

The NPS is registered as a major shareholder in 16 affiliates including Hotel Shilla Co., the accommodation unit of Samsung Group, and Hyundai Engineering & Construction Co. of Hyundai Motor Group.

In particular, the NPS has significant decision-making influence on Samsung Group, the country's largest business group with tech giant Samsung Electronics Co. under its wing, as it has 5 percent or more stakes in the group's 11 listed affiliates such as Samsung C&T Corp., Samsung Fire & Marine Insurance Co., and marketing company Cheil Worldwide Inc.

Against this backdrop, the NPS was able to play a major role in the merger between Samsung C&T and Cheil Industries Inc., the then de facto holding firm of the conglomerate, last year.

As part of Samsung's power-succession plan, the merger had faced a strong challenge from individual stakeholders led by US hedge fund Elliott Associates, but the merger was approved by a shareholder meeting on the back of the strong voting power of the NPS.

As a result, the chief of the NPS has been under prosecutors' investigation over allegations that the presidential office influenced his decision to back Samsung's merger plan through the pension fund.

The NPS also has stakes in other big businesses including Naver Corp., the No. 1 online portal operator, KT Corp., the largest fixed-wire service firm, and AmorePacific Corp., the leading cosmetics maker.

The total amount of shares that the NPS holds in listed companies is worth 100.1 trillion won ($85.3 billion) as of end-September. (Yonhap)