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S Korea antitrust body probes Hyundai Motor firms

Written by: Staff
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SEOUL, Sep 11 (Reuters) South Korea is investigating Hyundai Motor <005380.KS> group companies over suspicions of unfair practices in favour of the group's auto shipping unit, an official at the Fair Trade Commission said on Monday.

The probe is taking place as the group's chairman, Chung Mong-koo, has been on trial over charges including embezzlement of company funds. Hyundai Motor is the world's No. 6 auto maker along with its affiliate Kia Motors Corp. <000270.KS>.

The official said the probe was partly based on findings by the state prosecution officials from their investigation into Chung's case, but did not elaborate.

''We are to find out whether Hyundai's favourable treatment of Glovis was appropriate under fair trade laws,'' the official, who declined to be named, said by telephone. Glovis Co. Ltd. <086280.KS> is the group's auto shipping company.

The official declined to name individual companies under investigation.

Shares in Glovis Co. Ltd. <086280.KS> fell 5.15 percent to 34,050 won by 0417 GMT, underperforming a 1.09 percent drop in the broader market <.KS11>. Shares in Hyundai Motor Co., the country's top auto maker, fell 1.83 percent to 80,300 won.

Officials at Hyundai and Glovis declined to comment on the investigation.

Chung and his son, Chung Eui-sun, president of Kia, own a combined 60 percent stake in Glovis, while Norwegian shipping group Wihl. Wilhelmsen holds 20 percent.

In April, Hyundai said the chairman's family would donate their entire stake in Glovis to charity in a bid to apologise for the embezzlement scandals.

REUTERS SBA GC1130

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