Samsung's founding Lee family scored a win Friday in a landmark proxy battle, fending off opposition from investor activists led by a vocal US hedge fund, as the group continues its efforts to consolidate its various affiliates into a single corporate entity.

At a packed and often heated shareholder meeting, investors of construction firm Samsung C&T voted in favor of a $8-billion (7.4-billion-euro) takeover by the group's sister firm Cheil Industries in an all-share deal - but only just. Some 69.5 percent of votes cast supported the tie-up - a figure that scraped just above the necessary two-thirds majority.

The bittersweet victory comes as an enormous relief to the South Korean conglomerate run by the country's wealthiest family, as it seeks to restructure the multi-headed corporation ahead of a generational transfer of power from ailing patriarch Lee Kun-Hee.

Foreign shareholders' objections overruled

With the Lees already controlling Cheil, which is Samsung's de facto holding company, many see the takeover as the family further solidifying its grip on the entire conglomerate. The merger had been passionately opposed by a significant number of C&T investors, with US hedge fund Elliott Associates leading the opposition.

As C&T's second-largest single shareholder with a 7.1 percent stake, Elliott had argued the takeover willfully undervalued C&T's share price at an unacceptable cost to its shareholders.

But Samsung C&T executives insisted the deal made good business sense, saying the takeover will enhance shareholder value in the long run, with a more competitive merged company that could target annual sales of 60 trillion won (48 billion euros, $52 billion) by 2020.

"I am grateful for the shareholders who voted for the merger," C&T Chief Executive Officer Choi Chi-Hun told reporters. "We will do our utmost to ensure their support is repaid in the form of heightened shareholder value."

el/nz (AP, AFP, Reuters)