Proxy advisory firm International Shareholder Services on Monday recommended that Hyundai Motor Corp shareholders elect some directors nominated by Elliott Management at Hyundai Motor and autoparts supplier Hyundai Mobis as the activist hedge fund pushes for a large dividend payout.

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At Hyundai Motor, ISS recommended that shareholders vote for two Elliott nominees, John Liu and Robert MacEwen, as outside directors. ISS did not endorse Elliott nominee Margaret Bilson as an outside director.

At Hyundai Mobis, ISS recommended shareholders vote for Robert Kruse and Rudolph von Meister as outside directors. The firm recommended that the board expand to 11 directors from nine so both the activist and management slate could be elected. Kruse brings experience with electric vehicle and battery technologies while von Meister brings experience from having worked at leading auto part manufacturers.

Hyundai Motor Co is the flagship company and Hyundai Mobis is its parts and service arm.

ISS recommendations are closely watched by institutional investors and they are usually released shortly before the annual meeting date. Elliott, the $35 billion New York-based hedge fund, hopes to get seats on the board to push for the companies to return more capital to shareholders more quickly. It proposed that the Hyundai units return more than $6 billion in dividends.

The ISS report was released after another proxy adviser, Glass Lewis, recommended that investors vote against the three director candidates proposed by Elliott and against its dividend proposal.

Hyundai Motors and Huyndai Mobis will both hold shareholder meetings on March 22 when shareholders have a chance to vote on proposals made by the companies and Elliott. Analysts have said they are expecting a showdown at the vote between Hyundai and Elliott.

While the ISS recommendations give Elliott some support before the vote, ISS recommended against the new dividend plan the activist suggested at both companies.

Elliott had proposed a 2018 dividend of 4.5 trillion won for Hyundai Motor and 2.5 trillion won for auto parts supplier Hyundai Mobis, according to regulatory filings and sources.

Opposition from Elliott led Hyundai to drop an attempt to overhaul its ownership structure last year, and Executive Vice-Chairman Euisun Chung pledged in January to complete a restructuring expected to pave the way for him to succeed his father Mong-Koo Chung as group chairman.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)