Hanwha heirs sell stakes as succession accelerates

The two younger sons of Hanwha Group Chair Kim Seung-youn are selling part of their stakes in Hanwha Energy, the company that sits at the apex of the conglomerate’s ownership structure, in a 1.1 trillion won ($746 million) transaction with financial investors.

Hanwha said Tuesday that Hanwha Life Insurance President Kim Dong-won and Hanwha Galleria Vice President Kim Dong-seon will sell 5 percent and 15 percent stakes, respectively, in Hanwha Energy to a consortium led by Korea Investment Private Equity.

Following the deal, Kim Dong-won’s stake in Hanwha Energy will fall to 20 percent and Kim Dong-seon’s to 10 percent. The eldest son, Kim Dong-kwan, vice chairman of Hanwha Group and chief executive of Hanwha Aerospace, will retain his 50 percent holding, preserving effective control within the family.

Hanwha said the two brothers plan to use most of the proceeds to cover taxes, including gift taxes, while reinvesting a portion into new businesses and other areas of interest.

The transaction is widely seen as accelerating the group’s transition to third-generation leadership while laying the groundwork for a potential public offering of Hanwha Energy.

Hanwha Energy is the largest shareholder of Hanwha Corp., the group’s de facto holding company, with a 22.15 percent stake. In April, Chair Kim transferred half of his 22.65 percent stake in Hanwha Corp. to his three sons, a move that underscored the succession process. The latest stake sale is viewed as further cementing Dong-kwan’s position as heir apparent.

"The transaction has helped Hanwha Energy establish a more transparent and efficient governance structure, while strengthening its financial stability and credit profile," a Hanwha official said, adding, "The company expects a future initial public offering to enhance corporate and shareholder value and support its ambition to become a global energy solutions provider."