Samsung C&T shares on Tuesday fell below a key level set in its $8 billion merger with sister firm Cheil Industries on speculation that Elliott Associates, a key opponent to the deal, may soon sell its stake in the builder.

Elliott, the U.S. hedge fund that had launched an agressive campaign to block the merger deal, returned its C&T certificate to the Korea Securities Depository on Monday, meaning it can now sell its 7.1 percent stake in the company.

Elliott is also said to have returned the certificates of Samsung SDI and Samsung Life Insurance where it has secured a 1 percent stake, respectively, ahead of a shareholders’ vote on the merger last month. 

“Returning the certificates means it would not exercise its shareholder right any more. Elliott could sell off its C&T shares,” said an industry source on condition of anonymity.

But the source said it is unlikely for Elliott to sell its stake immediately considering the current share price is lower than its estimated purchase price.

On Tuesday, C&T’s shares closed at 57,000 won ($49), falling below the put-back option price set in the merger deal. Investors who opposed the deal can sell their shares to the company at 57,234 won per share by Aug. 6.

Industry watchers estimated Elliott may have acquired its 11.12 million shares in C&T at about 60,300 won per share.

“Elliott would not make a money-losing decision,” the source said.

In the meantime, Samsung C&T is seeking to secure financing for appraisal right claims.

Cheil or C&T can call off the merger if the combined cost of shares being sold to them by their shareholders exceeds 1.5 trillion won.

Last year, the merger of Samsung Heavy Industries and Samsung Engineering also failed due to the soaring appraisal right claims even though it succeeded in getting shareholders’ approval.

Kim Se-ryon, an analyst at KB Investment and Securities, however, downplayed the chance of the deal collapsing, given the merger is crucial for Samsung’s restructuring and leadership transition to a new generation.

“The 1.5 trillion won is a kind of yardstick. Even when the combined costs exceed the amount, Samsung would go ahead with the merger,” she said.

“In order to reduce related costs, Samsung needs to come up with defensive measures and elevate its share prices.”

By Lee Ji-yoon (jylee@heraldcorp.com)