Published : Sept. 1, 2014 - 20:46
Every business empire has a success story. Many of them started as a very small business, weathering ups and downs to grow into a global company. Some remain living legends and others struggle to be remembered.
Here are some South Korean business magnates who are striving to return to their roots.
Kumho Asiana
The management and labor union of Kumho Asiana Group, the country’s 14th-largest business conglomerate by assets, recently released a statement denouncing the private equity funds trying to sell Kumho Express Bus, which the conglomerate aims to rebuy.
Kumho Express Bus is known as the forerunner of Kumho Asiana, which has expanded to an airline, tire production, a cultural foundation, an academy and others. The late founder of the company, Park In-cheon, started the company in 1948 with two taxis, which quickly grew into the nation’s No. 1 express bus company. It also operates in China and Vietnam.
In its downsizing and liquidation plan in 2012, Kumho Asiana had to sell the bus company to IBK Securities-Keistone Partners for 331 billion won. Kumho Asiana was granted a preemption in case of a resell.
Two years later, when the company was put on the market, Kumho Asiana reportedly learned that there were more rivals in the bidding and that IBK Securities-Keistone Partners had raised the starting price to 600 billion won, far higher than the business group could afford.
“But we are asking the current management to take Kumho Asiana’s hand so that Kumho Express Bus can once again be the root of Kumho Asiana Group,” it stated. About 100 members held a protest in front of the private equity fund office in central Seoul.
Kumho Asiana Group chairman Park Sam-koo also pledged to win back Kumho Express Bus at the memorial service of Park In-cheon in June.
Hyundai Motor Group
Hyundai Motor Group’s acquisition of Hyundai Engineering & Construction in 2010 was more than a means of strengthening its business portfolio and seeking synergy.
Reconstructing the group’s core was chairman Chung Mong-koo’s claim to the legitimacy of Hyundai, which is now split largely into Hyundai Group, Hyundai Motor Group, Hyundai Department Store, Hyundai Heavy Industries and others.
Founded in 1947 by the late Hyundai Group founder Chung Ju-yung, Hyundai Construction has been the epitome of Hyundai spirit.
Chung Ju-yung, who died in 2001, is said to have shifted South Korea’s economic paradigm from light industry to heavy industries with the company. From Gyeongin Expressway linking Seoul and Incheon, and later Gyeongbu Expressway between Seoul and Busan, to expressways, ports and docks in Thailand, Saudi Arabia and others, the company has been the backbone of the industry and the country’s economy.
The company came under creditor ownership in 2001 but was finally acquired by Chung Mong-koo, the eldest surviving son of Chung Ju-yung.
Upon the acquisition, Chung Mong-koo is known to have visited his Gye-dong office in Seoul, where Hyundai Construction is headquartered, more than once a week. On his first day there, the 76-year-old said, “This is so emotional.”
Securing the rootsSamsung Everland’s fashion division on July 4 announced that it would revert to the name Cheil Industries, less than a year after it took Cheil’s fashion unit under its wing.
The decision was approved by the board of directors because there was a shared understanding that Cheil Industries, whose Korean name means Cheil Textile, is one of the roots of the Samsung empire.
Established by Samsung founder Lee Byung-chull, the company remained one of the center points of Samsung. Lee himself held his position as a registered executive until his death in 1987.
And the board of directors’ decision reflects such sentiments, company insiders say.
“When it comes to the origin of the company, the management tries to keep it regardless of their profitability. It is thought to symbolize the identity of the business group,” an executive of a large corporation told The Korea Herald.
By Bae Ji-sook (baejisook@heraldcorp.com)