'Business-type Holding Company' Launches... Moves to Solidify Succession Structure
[Asia Economy Reporter Seong Giho] Cho Hyun-beom, CEO of Hankook Tire & Technology (formerly Hankook Tire), has taken the position of CEO of the holding company Hankook Technology Group (formerly Hankook Tire Worldwide) and merged Hankook AtlasBX to transition into a 'business-type holding company.' Hankook Technology Group explains this as part of strengthening responsible management, but industry insiders see it as Cho CEO's intention to seize management control and solidify the succession structure.
According to the industry on the 27th, Hankook Technology Group held a board meeting the day before and decided to newly appoint Cho CEO as the representative director. Accordingly, the previous system under Vice Chairman Cho Hyun-sik, CEO of Hankook Technology Group, will change to a dual CEO system.
Cho CEO resigned from his position as CEO of Hankook Tire & Technology ahead of the appellate trial in June this year but maintained his position as president, registered director, and Chief Operating Officer (COO, President) of Hankook Technology Group. On the 20th, he avoided imprisonment by receiving a 3-year prison sentence with a 4-year probation in the appellate trial and returned as the CEO of the holding company.
Industry insiders view this decision as Cho CEO's move to further strengthen his position within the group amid the management rights dispute. Coincidentally, on the 25th, the adult guardianship trial, which sparked the Hankook Tire management dispute, commenced.
Cho Hee-kyung, eldest daughter of Chairman Cho Yang-rae and director of the Hankook Tire Nanum Foundation, recently returned from the United States, completed a two-week self-quarantine, and appeared at the Seoul Family Court the day before to undergo her first interview investigation. Immediately after the interview, Director Cho strongly criticized CEO Cho, saying, "Can employees trust and follow CEO Cho Hyun-beom, who caused losses to the company through immoral corruption and poor management decisions?"
Moreover, last month, Vice Chairman Cho also submitted a statement as a participant, expanding the management dispute into a fight among Cho CEO and his siblings. Vice Chairman Cho is scheduled for a court interview on the 29th of next month.
On the same day, the declaration to absorb and merge the battery-specialized subsidiary Hankook AtlasBX and transform Hankook Technology Group from a pure holding company to a business-type holding company is interpreted in this context. The merger ratio is 1 to 3.39, where for each share of the dissolving company Hankook AtlasBX (53,599 KRW), 3.39 shares of the surviving company Hankook Technology Group (15,801 KRW) will be allocated. Both companies plan to complete the merger by April 1 after going through all necessary procedures such as board meetings or shareholders' meetings in January next year.
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