Hyundai Motor to buy back W450tr of shares amid stock slump

Hyundai Motor, South Korea’s top automaker, said Tuesday it would buy back 450 billion won ($413.6 million) worth of shares in the next three months to prop up its stock price, after hitting lows not seen in years due to a grim outlook and a pricey land deal.

In a regulatory filing, the automaker said it would buy common shares worth 366.8 billion won and preferred shares worth 82.3 billion won to “increase shareholder value.”

Kia Motors, Hyundai’s affiliate, also announced it would repurchase shares worth 220.9 billion won for the same reasons. The latest move comes after Hyundai’s share price plunged to its lowest level in four years, raising concerns about the world’s fifth-largest automotive conglomerate’s fundamentals amid weak sales and unfavorable exchange rates.

After the announcement, Hyundai Motor’s share jumped 4.8 percent as of 11:10 a.m. on the Seoul bourse, and Kia Motors rose 2.2 percent from the previous day.

Shares of Hyundai Motor had nosedived to 149,000 won on Nov. 5, down 33.63 percent compared to the closing price at the beginning of the year. The last time its stock prices fell below the 150,000-mark was in 2010.

Foreign holdings of its shares have steadily decreased to 44 percent after a consortium led by Hyundai Motor Group signed a deal in September to buy a land lot in southern Seoul for 10.55 trillion won. (Yonhap)