Nexon After Kim Jeong-ju's Departure, New Head is Wife Yoo Jeong-hyun

[Asia Economy Reporter Kang Nahum] Yoo Jung-hyun, auditor of NXC and wife of the late founder Kim Jung-ju, has been designated as the new head (same person) of the Nexon Group.

On the 27th, the Fair Trade Commission announced that it would change the same person (head) of Nexon from founder Kim to his wife, auditor Yoo.

The Fair Trade Commission designates large business groups (with total assets exceeding 5 trillion won in the previous year) and their heads every May 1st. The term "head" here refers to the person or entity that effectively controls the large business group.

The Fair Trade Commission explained, "Considering that Yoo Jung-hyun, who co-managed with founder Kim Jung-ju, was involved in the founding and management of Nexon, and that she is the only investor among the registered executives (auditors) of the top company NXC as well as the largest individual investor."

Looking at Nexon's corporate governance, founder Kim (67.49%) and his family hold most of the shares of the top controlling company NXC. NXC directly holds 28.5% of the shares of Nexon Japan, the headquarters, and indirectly holds 18.8% through its 100% subsidiary, the Belgian investment company NXMH. Nexon Japan owns Nexon Korea, which in turn controls major affiliates such as Neople and Nexon GT.

Auditor Yoo holds 29.43% of NXC shares, while Kim Jung-min and Kim Jung-yoon, daughters of founder Kim, each hold 0.68% of NXC shares. Combined, Yoo and the two daughters hold 30.79%. Nexon's total assets amount to 11.261 trillion won, ranking 39th in the business world by asset size.

Although auditor Yoo has become the head, the industry expects her involvement in management to be limited. This is because, following founder Kim's vision to strengthen corporate social responsibility and expand global investments by entrusting management to professional managers, a professional management system was established early on. Last July, NXC appointed Lee Jae-kyo, head of brand promotion, as the new CEO, and Alex Iosilevich as the global investment chief.

However, depending on the fate of the 67.49% stake held by founder Kim, there is a possibility that the owner may change. Industry insiders also speculate that auditor Yoo may sell shares considering inheritance tax and other factors.

According to current law, if the taxable base exceeds 3 billion won, the highest tax rate of 50% is applied, and if the major shareholder's stake exceeds 50%, a surcharge is added, making the total inheritance tax rate over 60%. Since NXC's valuation is estimated to exceed 10 trillion won, the inheritance tax to be paid is expected to reach several trillion won. Due to the burden of paying such an amount at once, it is expected that procedures such as stock sales will be undertaken.