Tuesday, January 14th, 2014
SEOUL, KOREA - The share price of Hyundai Engineering & Construction is showing weakness on the news that the merger between its subsidiaries, Hyundai Engineering and Hyundai Amco, won't benefit their parent company. At 9:02 am on January 14, the shares of Korea's largest construction contractor were traded at 59,300 won, down 2.47 percent from 60,800 won.
The Korea Exchange on the previous day demanded to Hyundai E&C to disclose the rumor of merger between its subsidiary companies. Kang Seung-min, analyst with NH Securities, said in a research report on the same day that investors must approach the stock carefully because of the negative repercussions the merger may have on the contractor.
"It is still unclear how much stake Hyundai E&C will take in the newly merged entity while there is a possibility that Hyundai Automotive Group shifts its weight favorably on the new company by giving most construction jobs to it."
