Hyundai’s $10 billion plot purchase approved by management boards image

The boards of directors of Hyundai Motor, Kia Motors and Hyundai Mobis have approved the record 10.55 trillion won ($10.12 billion) bid to acquire a prized land lot in Seoul, to be used for their future headquarters.

The deal sparked controversies, as the final amount is at least three times bigger than the initial appraisal of the property, and the rival bidder – Samsung Electronics – reportedly only offered around 4 to 5 billion dollars.

Last week, the announcement of the cash deal sent the three companies shares down, with the prized lot to be used for the group’s headquarters, a hotel and even a theme park. Reuters even reported the Hyundai board of directors approved the September 18 bid without even knowing the price for the auction.

The state-owned Korea Electric Power Corp was the owner of the plot, and news of the amount to be paid reignited the deep worker resentment – with unions resuming partial strikes this week – a move that casts a shadow over the already controversial annual salary negotiations.

The Hyundai-led Group plans to sign the final purchase contract with the seller later on today, with Hyundai Motor paying 55%, Hyundai Mobis 25% and Kia Motors the rest of 20% of the agreed price.

Via Reuters