[Exclusive] Chairman Cho Hyun-beom, Winner of Management Rights Dispute, "Continuing Efforts to Reconcile with Brothers"

Visiting the Court to Attend Trial Related to Breach of Trust and Embezzlement

Cho Hyun-bum, chairman of Hankook & Company, who won the management rights dispute, announced that he will make efforts to reconcile with his siblings.

On the 11th, Chairman Cho made this statement during a meeting with reporters at the Seoul Central District Court in Seocho-gu, Seoul. Facing allegations of unfair support to affiliates, embezzlement, and breach of trust, Chairman Cho visited the Seoul Central District Court to attend a continuation of the trial that day.

When asked about his thoughts on successfully defending his management rights, Chairman Cho was reserved, saying, "It's not something good, so I hesitate to call it a success." Since the dispute with his siblings has been settled for the time being, he also mentioned the possibility of future reconciliation. Chairman Cho said, "I will continue to try to reconcile (with my siblings)." Although on December 8 last year, he had excluded his elder brother, Cho Hyun-sik, an advisor at Hankook & Company, and his elder sister, Cho Hee-won, from the list of special related parties, he expressed his intention to work towards restoring relations. Special related parties refer to special relations such as relatives of the largest shareholder and co-owners of shares. Being excluded from the special related parties means that the relationship has completely broken down from a friendly one.

Previously, Cho Yang-rae, honorary chairman of Hankook & Company, and his eldest son, Advisor Cho, and eldest daughter, Cho Hee-kyung, chairwoman of the Hankook Tire Sharing Foundation, joined forces with the private equity fund MBK Partners to conduct a tender offer to acquire management rights of Hankook & Company. However, they failed to secure the target shares by the tender offer deadline on the 24th of last month, resulting in the second sibling conflict in the Hankook Tire family ending with the victory of the second son, Chairman Cho.

However, a variable remains in the limited guardianship trial petition filed by Chairman Cho’s sister, Director Cho, against Honorary Chairman Cho. Chairman Cho’s stake was about 19%, but in 2020, Honorary Chairman Cho transferred all his shares (23.59%) to Chairman Cho through an off-hours block trade. Director Cho filed the limited guardianship petition, arguing that it is difficult to see that their father transferred the shares while in a normal state. The limited guardianship system is a system where an adult who lacks the capacity to handle affairs due to reasons such as old age receives property management through a guardian.

After the first trial was dismissed in April 2022, Director Cho appealed, stating that a psychiatric evaluation of Honorary Chairman Cho was necessary. At the end of December of the same year, the psychiatric evaluation results of Honorary Chairman Cho were submitted, and a trial was scheduled to be held at the Seoul Family Court on that day, but the hearing date was postponed to early March this year. When asked about the reason for the postponement of the hearing date, Chairman Cho replied, "I don't know."