An international tribunal ordered South Korea on Tuesday to pay around US$53.59 million plus interest to US-based hedge fund Elliott Investment Management, bringing an end to a yearslong dispute surrounding a controversial merger of two units of Samsung Group.

The Permanent Court of Arbitration in the Netherlands delivered the verdict in the investor-state dispute settlement suit that the New York-based activist fund filed in 2018 demanding the compensation of $770 million from the Seoul government.

The ordered amount represents approximately 7 percent of the firm's demand, the Ministry of Justice said in a press release.

Additionally, the Seoul government was ordered to pay an annual interest rate of 5 percent compounded from July 16, 2015, to the date of the judgment, according to the ministry.

The legal battle dates back to 2015, when South Korea's state pension fund supported the merger of Samsung CT&T Corp. and Cheil Industries Inc., a move widely seen as tightening Samsung heir Lee Jae-yong's control over the group.

At the time, Elliott, which held a 7.1 percent stake in Samsung C&T, claimed damages resulting from the former Park Geun-hye administration's intervention in the $8 billion merger deal.

Elliott led a proxy fight against the firm's merger with Cheil Industries, citing unfair terms that it said greatly undervalued the company and investors' interest. But the controversial merger went ahead, backed by the state-run National Pension Service's (NPS) swing vote in Samsung's favor.

The deal later became the center of a massive corruption scandal that led to the ousting and the conviction of former President Park, as well as the imprisonment of Lee, the former health minister and the chair of the NPS.

The arbitration proceedings were launched in 2019 and ran until 2021. (Yonhap)