As the power struggle between two siblings of Hanjin Group’s controlling family continues ahead of the upcoming shareholders meeting, their mother and sister, who are major stakeholders, said they backed the brother of the two.
In a statement Tuesday, Lee Myung-hee, the mother of the siblings and their youngest sister Hyun-min expressed support for Hanjin Group Chairman Cho Won-tae over his sister Cho Hyun-ah, the former vice president of the airline.
“Lee Myung-hee and Cho Hyun-min, as major shareholders of Hanjin Group, heed the late president’s instructions and wish for stability and development of the group,” they said in the joint statement delivered to the company. “We support the group’s current system with professional corporate management, led by Chairman Cho Won-tae.”
Won-tae and Hyun-ah, the infamous “nut rage” heiress and the eldest of the siblings, have been in a feud to take control over the group, which owns Korean Air, and its holding company Hanjin KAL. Hyun-ah on Friday announced that she is collaborating with local activist fund Korea Corporate Governance Improvement and midsized builder Bando Engineering& Construction -- which own 17.29 percent and 8.28 percent stakes, respectively.
Speculation was rampant about which side the mother and the other sister would take, until they expressed regret over Hyun-ah’s decision to team up with other companies.
“The management business environment is difficult in and outside the country. We want the current management to do their best to improve performance and financial structure, and earn support and love from the people, stakeholders, customers and employees,” the statement read.
“We cannot but feel regret for former vice president Cho Hyun-ah’s announcement to join with outer forces. We wish for her to return as a member of family and join forces for stability and development of Hanjin Group.”
Won-tae holds a 6.52 percent stake and Hyun-ah 6.49 percent. Lee and Hyun-min respectively hold 5.31 percent and 6.47 percent stakes.
Considering the combined shares of stakeholders supporting each of the siblings, Won-tae appears to be slightly ahead, at 33.45 percent, while Hyun-min is backed by 31.98 percent. The casting vote with the latest development appears to lie with the National Pension Service, which holds a 4.11 percent stake, along with other smaller stakeholders, industry watchers said.
By Jo He-rim (email@example.com