Delta raises stake in Hanjin KAL to 14.9% amid proxy fight
Delta Air Lines Inc. hiked its stake in Hanjin KAL Corp., the parent company of South Korea’s biggest carrier Korean Air Lines Co., to 14.90 percent from 11.00 percent, throwing its support behind the Hanjin chief who has been locked in a proxy battle with his older sister.
The U.S. carrier disclosed its share purchase in a regulatory filing Monday. It has been gradually upping its stake in Hanjin KAL since late last month.
With Delta’s move, Hanjin Chairman Cho Won-tae now has a combined 43.15 percent stake in his favor. Cho and other family members together own 22.45 percent in Hanjin KAL, with Kakao holding 2 percent and the Korean Air employee association 3.80 percent.
Hanjin Chairman Cho Won-tae
His sister, Cho Hyun-ah, has teamed up with major shareholders to oust her brother when Hanjin KAL shareholders meet on Mar. 27 to vote for his reelection as chairman of the board. Her coalition includes local activist fund Korea Corporate Governance Improvement (KCGI), which is the biggest single shareholder with 17.83 percent, and Bando Engineering & Construction Co., which owns 13.30 percent. Together with her own 6.49 percent share, the Hanjin heiress union holds a combined 37.63 percent, falling short of her brother.
Some market experts believe Delta may push its Hanjin KAL stake beyond the 15 percent limit. Under local rules, Delta needs to pass the Fair Trade Commission’s review on market monopoly if it wants to further increase its holdings.
An industry observer noted that Delta received conditional approval in its antitrust review when it formed a joint venture with Korean Air in 2018 and that its increased stock purchase in Korean Air’s parent Hanjin KAL also stands a good chance of getting the green light.
By Han Woo-ram and Kim Hyo-jin
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]
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