'Choi Seonghwan,' Eldest Son of Choi Seewon... Dream of Standing on His Own

After Promotion to CEO, Will He Initiate Share Transfer?
Sell ㈜SK and Acquire SK Networks
Will Chairman Chey Tae-won Step Out of the Shadows?

[Asia Economy Reporter Oh Hyung-gil] Choi Seong-hwan, president of SK Networks, is hastening his steps toward standing on his own.

Although his father, Choi Seon-won, former chairman of SK Networks, has stepped down from management and there are no competitors blocking succession, it is still observed that there is a long way to go. This is due to the strong influence of Choi Tae-won, chairman of SK Group.

On the 3rd, President Choi sold 16,000 shares of SK Inc. He sold them on the market for about 3 billion KRW based on the closing price of the day. His holdings decreased from 244,956 shares to 228,971 shares, and his stake fell to 0.31%. This share sale was made about a month after his promotion, and the business community interprets it as a step toward independence.

President Choi is converting SK Inc. shares into SK Networks shares. After receiving a 0.7% stake in SK Inc. through a gift from Chairman Choi Tae-won in 2018, he increased it to 0.74% the following year, but has sold nearly half since 2021.

On the other hand, he has been steadily increasing his stake in SK Networks. At the end of December 2021, his stake was 1.89% (4,686,836 shares), which increased to 2.63% (6,536,659 shares) by the end of October last year. As the largest individual shareholder, this is about three times more than his father, who stepped down from management in 2021 (0.84%). Former Chairman Choi is the second son of Choi Jong-geon, founder of SK Group and chairman of Seonkyung Group, and cousin of Chairman Choi Tae-won.

However, President Choi’s independence is still distant. The largest shareholder of SK Networks is SK Inc., holding a substantial 39.14% stake. Although President Choi is focused on increasing his shares, it is considered impossible to escape the shadow of Chairman Choi Tae-won, the largest shareholder of SK Inc.

Former Chairman Choi’s stake in SK Inc. is only 0.03%, so even combined, the father and son’s shares do not exceed 0.5%. This is a significant difference compared to Chairman Choi Tae-won’s 17.37% stake in SK Inc.

Born in 1981, President Choi worked in the strategy and investment division at SK Inc. before joining SK Networks in 2019. He was promoted to president in last year’s year-end personnel reshuffle.

SK Networks started from Seonkyung Textile, the origin of SK Group, transformed through a general trading company, and then acquired Dongyang Magic (now SK Magic) and AJ Rent-a-Car, evolving into a comprehensive rental company. Recently, it invested in SS Charger, which was spun off from Everon, a domestic slow electric vehicle charger operator, and Estraffic, the top private fast electric vehicle charger operator in Korea. The company is nurturing the electric vehicle charging business as a new growth engine.

An industry insider familiar with the business said, "SK Networks maintains autonomous management without interference from SK Group within SK’s unique management culture of ‘together yet separate.’" He added, "However, considering ownership stakes, separation between Chairman Choi Tae-won and former Chairman Choi Seon-won is practically impossible."