needed. And many of those votes, many concluded, probably came from
the National Pension Service, which had yet to reveal its vote.
“The approval is huge for us,” CEO Choi Chi-hun told the room in a
sentimental and emotionally charged speech. Samsung, he said, would
remember the goodwill of its supporters.
Executives later admitted to the media that the turnout against the
company was unnerving.
“Elliott is disappointed,” Paul Singer said in a statement, “that the
takeover appears to have been approved against the wishes of so many
independent shareholders, and reserves all options at its disposal.”
Elliott’s lawyers noticed that the chairman, rumored to be incapacitated
in his hospital suite, had yet managed to “vote” in favor of the merger.
“Elliott has questions about the validity of proxies of Chairman Lee,”
the law firm said. “The Chairman failed to appear due to health problems.
If Lee provides proxies, then please clarify the timing. This is about
whether or not Chairman Lee made clear his view on this issue.”
The Washington Post had reported earlier that the chairman had been
“unable to speak since May [2014].” Samsung C&T’s CEO rebuffed the
challenge from Elliott’s lawyers, claiming the chairman had voted through
legal representatives.
As the company prepared to execute the merger that fall, the Samsung
C&T stock tumbled. By May 2016, shares in the newly merged company
had lost 40 percent of their value. By November of 2016, more than a year
after the vote, the National Pension Service had suffered $500 million in
losses.
On paper, Jay Lee remained vice chairman, since in Korea’s Confucian
tradition he couldn’t become chairman while his father was still alive. That
would be an affront to the supreme leader. But as the victor, Jay raised his
shareholding value and moved a major step closer to the throne. The nosy
New York interlopers were held at bay, for now. But the battle for the
Republic of Samsung was not over.
“My observation on Samsung, is that Samsung is pretty unique and a
very excellent dynasty,” said the former chief of the National Pension
Service, a crusty and passionate pro-chaebol conservative named Choi
Kwang, who told me the story of the merger vote over dinner almost two
years later.
We sat in a private dining room off the historic Seoul Station in 2017,