Ongoing Struggle
Samsung C&T claims that documentary evidence Elliott Management submitted for their litigation over a merger between Cheil Industries and itself was falsified.
On June 21, Samsung C&T asked the Seoul Central District Court to tell the American hedge fund to submit the original document for evidence handed in on June 19. Samsung C&T also sent a request for verification to EY Han Young, which drew up the report. The report in question is about the analysis of the enterprise values of Samsung C&T and Cheil Industries, in which Elliott Management claims that the merger ratio of 1:0.35 is unfair.
In the early stages of the litigation, Elliott Management maintained that 1:1.6 is the proper ratio for the Cheil-Samsung merger based on the report. However, the attorney representing Samsung C&T said that the report is erroneous because it reflects the best cash flow regarding Samsung C&T and a general cash flow concerning Cheil Industries.
EY Han Young also mentioned that Elliott Management falsified the draft of the report, which was provided for general investment purposes, before the submission to the court, and it is looking to take legal action. “We have already asked the court to not adopt the report as evidence,” it explained, adding, “The submission constitutes a breach of contract.”
In the meantime, a group of minority shareholders of Samsung C&T announced that it handed in a petition against the merger to the court on June 22. The number of the Samsung C&T shares they collected is estimated at approximately 670,000, or 0.43 percent of the total.