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“A series of recent steps KT&G has taken including refusal to sell its idle real estate assets show that the company is completely neglecting shareholders’ rights,” Icahn and partners claim, prompting them to take over the firm.

While Icahn and partners say they proposed a friendly takeover to control the company, stock experts argue the bid was effectively hostile from the start, adding it was unlikely company management will accept the offer.

“If Icahn and partners actually start to buy KT&G shares, it would be the first-ever case where foreign investors attempt a hostile takeover by buying shares in a domestic listed company,” an official with the Financial Supervisory Service said.

KT&G share prices shot up 11.3 percent Friday to close at W57,000.

There are conflicting views whether Icahn will succeed. “Usually, such bids offer prices 30 percent higher than market price, but Icahn and partners offered to buy KT&G stocks at W60,000 a share, just 17 percent higher than the closing price of Feb. 23,” Park Dong-myung, an analyst with Good Morning Shinhan Securities said. “Since the stock price has already risen to W57,000 today, it is not likely they will be able to acquire sufficient equity in the company.”

(englishnews@chosun.com )