A South Korean investment firm has challenged Hyundai Motor Securities Co.’s planned 200 billion won ($153 million) share sale, marking the latest clash between the brokerage and its minority shareholders.
Tubuki Investment LLC filed for an injunction at the Seoul Southern District Court to block the issuance of about 30.1 million new common shares. The legal action targets the company’s chief executive officer Bae Hyung-geun directly.
The dispute prompted South Korea’s financial regulator to intervene, with the Financial Supervisory Service requesting a revised securities report from the brokerage last month. Hyundai Motor Securities submitted an updated filing that took effect on January 10.
The brokerage plans to use half of the proceeds to fund growth initiatives, with the remainder earmarked for debt repayment, including 77.5 billion won of convertible preferred stock and 22.5 billion won of commercial paper issued in 2019.
Tubuki, represented by Korea Corporate Governance Forum’s vice president Chun Jun-beom, contends the share issuance could harm existing stockholders through dilution.
The court will hold its first hearing on January 15. If approved, the share price will be set on February 21, followed by a subscription period for current shareholders in late February and public offering in early March.
