A court in South Korea has rejected an attempt by US activist investor fund Elliot to stop a shareholder vote on a proposed $8bn merger of two key Samsung Group firms.
The merger would see Cheil Industries, a Samsung de-facto holding company, take over its sister firm, construction group Samsung C&T.
The US activist fund has argued the merger is not in the best interests of Samsung C&T’s shareholders.
Elliot holds 7.1% of Samsung C&T.
Samsung is the largest of South Korea’s chaebols – huge family-run conglomerates. Other chaebols in South Korea include Hyundai and LG.
Elliot has also said the multi billion-dollar merger between Cheil Industries and Samsung C&T would give an unfair advantage to Samsung Group’s Lee family – the nation’s most powerful corporate name.
Samsung Electronics’ vice-chairman and Samsung Group’s heir apparent, Lee Jae-yong, is the major shareholder in Cheil Industries.
Analysts have said the motivation behind the proposed merger is likely to be the Lee family’s efforts to ensure it stays in control of Samsung amid a generational changeover of power.
The shareholder vote on the merger is set for 17 July.