The elder brother of the chief of retail giant Lotte Group said Tuesday he has raised an objection to the conglomerate's governance shakeup plan, demanding that a key unit be taken off the list of split-ups.
In April, the board of directors of the group's four key affiliates passed a plan to split each of them into investment and business entities.
Under the plan, which will be put up for approval at their respective shareholders meetings next month, the investment entities split from the four units will likely be merged to become a holding firm that will control other business arms under its wing.
Shin Dong-joo, the elder son of Lotte Group founder Shin Kyuk-ho, arrives at the Seoul Central District Court in the capital on June 7, 2017, to stand trial over corporate crime allegations. (Yonhap)
Shin Dong-joo, embroiled in a leadership battle with the incumbent group chief Shin Dong-bin, said he made a proposal at the planned shareholders meetings, demanding Lotte Shopping, one of the four affiliates, be excluded from the governance revamp plan.
Shin claimed Lotte Shopping's business outlook remains uncertain due to various factors, including Beijing's economic retaliation over the deployment of a US missile defense system here. He also said the revamp plan is aimed at meeting a certain shareholder's personal interest.
The proposal is part of the elder Shin's efforts to expand his presence as the leadership battle with his younger brother virtually came to an end last year after the incumbent chief won shareholder support to tighten his grip on the group.
The elder son has claimed that the group founder Shin Kyuk-ho handpicked him as the successor for the retail group, but Dong-bin insisted that his father was unable to make reasonable judgments due to mental health issues.
Last month, the country's top court confirmed the designation of a nonprofit subsidiary of a law firm as the guardian of the founder, efficiently backing his second son's argument. (Yonhap)