Mrs. Kim Young-sik, CEO Koo Yeon-kyung, and Mr. Koo Yeon-soo's Je-gi
LG "Cannot tolerate actions that shake management rights"
Kim Young-sik, the mother of LG Group Chairman Koo Kwang-mo, and his younger sisters Koo Yeon-kyung, CEO of the LG Welfare Foundation, and Koo Yeon-soo have filed an inheritance recovery lawsuit demanding the redistribution of inherited assets against Chairman Koo. LG's position is that the inheritance process has already been completed through legal procedures. They also criticized the lawsuit as an act that shakes LG's tradition and Chairman Koo's management rights.
On the 9th, LG conveyed this news, stating, "We regret having to share such unexpected news." They added, "The inheritance of assets left by the late Chairman Koo Bon-moo was legally completed over four years ago, exceeding the statute of limitations period of three years," and said, "It is difficult to understand the Koo family raising inheritance issues at this point."
LG maintains that there is no problem as the inheritance was finalized through family consultations within five months after the late chairman's passing. They further explained that legally, it is important whether the division of inherited assets was done with the agreement and consent of the heirs.
The assets left by the late Chairman Koo amount to about 2 trillion KRW, including 11.28% of LG's total shares. The heirs?Chairman Koo Kwang-mo, Mrs. Kim Young-sik, CEO Koo Yeon-kyung, and Mr. Koo Yeon-soo?agreed in November 2018, following LG family traditions, that management-related assets would go to Chairman Koo, while Mrs. Kim and the two sisters would inherit some LG shares and about 500 billion KRW worth of the late chairman's assets.
LG explained, "According to LG family principles and traditions, Chairman Koo was supposed to receive all LG shares related to management rights," adding, "Chairman Koo accepted requests from other heirs, resulting in CEO Koo and Mr. Koo receiving 2.01% (approximately 330 billion KRW at the time) and 0.51% (approximately 83 billion KRW at the time) of LG shares, respectively."
"Acts that shake LG tradition and management rights will not be tolerated"
LG has a family tradition of avoiding disputes over assets, especially since the business initially partnered with the Heo family and there are many descendants. LG explained that the group has been able to operate stably because this tradition has been upheld through family consultations and agreements.
LG stated, "Since its founding in 1947, management rights have been succeeded based on consistent principles and traditions, and there has never been a single internal dispute over management rights or assets in 75 years," emphasizing, "The principle of succession is that management-related assets go to the family representative and management responsible person, while personal assets are divided among the remaining family members in a predetermined ratio."
They also criticized, "Since Chairman Koo, the largest shareholder of LG, exercises voting rights on behalf of the LG family, the shares cannot be disposed of arbitrarily," adding, "Demands for asset division that shake LG tradition and management rights cannot be tolerated."
Chairman Koo has decided to pay the inheritance tax of approximately 720 billion KRW on the inherited 8.76% LG shares in six installments over five years. Five payments have been made so far, and the final inheritance tax payment is scheduled for the end of this year. The total inheritance tax to be paid by all heirs, including CEO Koo, amounts to 990 billion KRW.
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