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Convicted Hyundai Motor Chief Re-elected

Hyundai Motor shareholders approved the re-election of Chung Mong-koo to the South Korean automaker's board at an annual meeting on Friday, despite opposition from the country's state pension fund.

Hyundai
Hyundai


Officials from the National Pension Service, the world's fourth-biggest pension fund and Hyundai's sixth-largest shareholder with a 4.56 percent stake, had said it planned to vote against Chung's re-endorsement, noting his conviction for fraud and the need for management improvements.

Chung, the eldest surviving son of Chung Ju-young who founded the Hyundai Group in 1947 and Hyundai Motor in 1967, was last year handed a suspended three-year jail term for fraud.

Shareholders endorsed Chung without a vote, saying Hyundai needed strong and experienced leadership to cope with tough market conditions.

"Hyundai is facing risks including higher prices of oil and raw materials, a slowing global economy, checks from bigger rivals of Europe and Japan, competition with newcomers in India and China," Chung said in a statement to shareholders.

Hyundai, the world's No.6 automaker by sales volume, plans to boost its brand image in developed markets, and sell more cars specifically into emerging countries, said Chung, who will stay as chairman and chief executive until March 2011.

Hyundai and its affiliate Kia Motors outperformed the broader market Friday. The shares were helped by a recent slide in the won currency, which on Friday hit a 26-month low to the dollar, analysts say.

A weaker won helps make Hyundai and Kia more competitive on pricing against foreign rivals and bolsters profits from overseas markets.