Hyundai Motor Group becomes KT’s largest shareholder

Hyundai Motor Group is now the largest shareholder of KT Corp., following the Ministry of Science and ICT’s announcement on Thursday that the Public Interest Review Committee determined that the change “does not harm the public interest.”

The National Pension Service (NPS), which was previously KT’s largest shareholder, sold some of its shares in March 2024 opening the way for Hyundai Motor Group to take its place.

KT applied for a public interest review of the change in major shareholders and after the National Pension Service disposed of 2,884,281 KT shares, its ownership percentage decreased from 8.53 percent to 7.57 percent. Hyundai Motor Group, whose current 8.07 percent share is split between Hyundai Motor Co. (4.86 percent) and Hyundai Mobis Co. (3.21 percent), thus became the largest shareholder.

According to the Telecommunications Business Act, a major shareholder of a telecommunications service provider must receive government approval. The Ministry of Science and ICT explained that the Public Interest Review Committee reached this conclusion based on several factors: there would be no change in KT’s business operations following the change, Hyundai Motor Group became the major shareholder involuntarily without acquiring additional shares, and it would be difficult to exercise actual management rights in Hyundai Motor Group’s current position.

Hyundai Motor Group exchanged shares with KT during discussions to promote future mobility business cooperation in September 2022, specifying that the investment purpose was for “general investment” and not to “participate in management.”

“After comprehensive consideration of factors such as the difficulty in exercising actual management rights even after the change of major shareholders, we concluded that this case does not negatively impact the public interest,” the review committee said.

The change in major shareholder from the NPS to Hyundai Motor Group does not alter KT’s management rights, as Hyundai Motor Group declared that it holds shares solely for investment purposes and will not participate in KT’s management.

For its part, the NPS still holds a significant enough stake to influence KT’s management, such as replacing the CEO. As it sold its shares for profit realization, there is speculation that the NPS could buy back KT shares.

By Lee Dong-in and Lee Eun-joo
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