Seoul court denies US fund's request to stop Samsung merger, says deal is fair and legal

SEOUL, South Korea – A South Korean court has denied an American hedge fund's request to stop Samsung from combining its two companies.

Seoul Central District Court said Wednesday the proposed takeover of Samsung C&T by Cheil Industries is legal and fair.

It says there is no evidence to conclude the deal serves only the Samsung founding family, who owns a majority stake at Cheil.

Elliott Associates, Samsung C&T's third-largest shareholder, filed an injunction last month saying the deal undervalues the construction and trading firm and hence hurts its shareholders.

Samsung says the merger was necessary for the future.

Many in markets saw it as part of the once-in-a-generation leadership transition. Lee Jae-yong, Samsung chair's son, will become the largest shareholder at the combined entity. C&T has a 4 percent stake at Samsung Electronics.