Norway investor urges Hyundai to improve corporate governance

Seoul

SKAGEN Funds, the biggest holder of Hyundai Motor Co preferred shares, is pushing South Korea's largest carmaker to improve corporate governance after a real estate purchase for three times the property's assessed value sparked a rout in the stock.

The Norwegian fund firm met Hyundai's management after companies controlled by Korea's second-largest family-run conglomerate agreed to the US$10 billion purchase for a new headquarters, hotel, convention centre and car museum in Seoul. The bigger of Hyundai's two preferred shares has lost 21 per cent since the deal was announced on Sept 18, while foreign investors sold a net US$370 million of Hyundai common shares.