"Family dispute spreading into a burden on the board"
"A decision to enable the board to focus on its original functions"
Chairman Cho Hyunbeom has resigned from his position as a registered director of Hanguk & Company.
On the 20th, Hanguk & Company held a board of directors meeting at its headquarters, Technoplex, in Seongnam, Gyeonggi Province, and resolved to change its current joint CEO structure to a single-CEO structure. Accordingly, the company will, for the time being, be operated under the sole leadership of President and CEO Park Jongho.
The company explained that this measure was decided to prevent recent conflicts within the family from spreading into issues of corporate management. A Hanguk & Company official said, "There were concerns that family matters were escalating into issues in the operation of the company, undermining the purity and independence of the board of directors," adding, "It was Chairman Cho's decision to avoid placing an unnecessary burden on the company and to enable the board to focus on its original functions."
Previously, a Hanguk & Company shareholder group filed a shareholder derivative lawsuit, arguing that Chairman Cho received a large amount of compensation while he was in custody and therefore should reimburse the company about 5 billion won. It is known that former Hanguk & Company adviser and Cho's older brother, Cho Hyunsik, who had previously engaged in a shareholding dispute with him, participated in this shareholder group.
In 2023, former adviser Cho joined hands with private equity fund MBK Partners to launch a tender offer for Hanguk & Company shares, but Chairman Cho, backed by his father, Honorary Chairman Cho Yangrae, succeeded in defending his management control. The company stressed that this resignation was a measure to prevent the family dispute from once again developing into a corporate risk.
Chairman Cho was indicted on charges of embezzlement and breach of trust under the Act on the Aggravated Punishment, etc. of Specific Economic Crimes and was sentenced to a prison term in the first trial in May last year, after which he has been in custody. With his resignation from the position of registered director, he has also lost his status as CEO.
A Hanguk & Company official stated, "This decision was made to prevent the company from being drawn into a war of attrition over procedural disputes, and to allow the management and the board of directors to focus on executing the business," adding, "Although he is stepping down from the board, he plans to continue to reflect on and play a role in the company's growth and the strengthening of its future competitiveness."
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