KCC opened a booth for PCIM Europe 2024, a power electronics exhibition, in Germany in June (Courtesy of KCC)
KCC Corp., a paint and glass maker, but better known as a white knight for South Korean conglomerates, holds more than 4 trillion won ($3 billion) worth of shares in Samsung C&T Corp., HD Korea Shipbuilding & Offshore Engineering Co and US silicon maker, surpassing its market capitalization of 2.6 trillion won.
KCC has played a key in helping owner families of Samsung and Hyundai defend their management rights against activist funds such as New York-based Elliott Management and Mason Capital Management during their merger or spin-off processes.
According to the Financial Supervisory Service, KCC’s shares in Samsung C&T, HD Korea Shipbuilding and Momentive Performance Materials Korea Co., a unit of the US-based silicone maker Momentive Performance Materials, were valued at a combined 4.5 trillion won as of the end of June.
The value swelled by more than 1 trillion won, compared with the end of last year.
KCC’s stakes in major companies and their market/estimated values (Unit: billion won)
KCC’s shareholding ratio
Market value as of end-June, 2024
Estimated capital gains in H1, 2024
Samsung C&T (9.57%)
2,415.4
212.6
HD Korea Shipbuilding & Offshore Engineering (3.91%)
438.9
104.8
Momentive Performance Materials Korea (100%)
1,675.0
Not available
(Note: Momentive Performance Materials is preparing to list on New York Stock Exchange)
(Source: The Financial Supervisory Service, calculations by The Korea Economic Daily
KCC had first invested in Samsung C&T in 2012 by purchasing shares in then unlisted Samsung Everland Co. The amusement park operator was merged into Samsung C&T.
In 2015, it raised its ownership of Samsung C&T, a move seen as aimed at backing the top shareholders of Samsung holding company against Elliott Management that led a proxy battle to block a merger between Samsung CT&T and Cheil Industries Inc.
Elliott had arguged their combination was aimed at tightening the control of Jay Y. Lee, now Samsung Group chairman, over the group and would undermine miniroty shareholders’ interests.
KCC was established in 1958 by Chung Sang-yung, a younger brother of Chung Ju-yung, founder and the late Chairman of Hyundai Group.
In the early 2000s, KCC has bought up shares in Hyundai Heavy Industries Co., Hyundai Motor Co., Hyundai Mobis and Hyundai Development Co. (HDC) to ward off any hostile investors in the process of spliting Hyundai Group into smaller business groups after its founder Chung Ju-yung died in 2001.
Some KCC shares are asking the company to cash out Samsung C&T and other shares when their share prices rise. Particularly, shares in HD Korea Shipbuilding have rallied, buoyed by the string of orders received.
But it rejected such a call, saying it has no plan to sell Samsung C&T shares but is working on making public Momentive Performance Materials.
By Ik-Hwan Kim
lovepen@hankyung.com
Yeonhee Kim edited this article
