Hankook Tire is looking to spin off into a holding company and a tire business-focused entity, according to a regulatory filing and media reports.

The holding company is likely to be a non-tire entity that will focus on venturing into new business areas, market watchers speculated.

The listed Korean tire giant filed a disclosure on the Korea Exchange on Friday, saying that it was considering a spin-off, but that nothing had been decided. Its statement continued that the company will re-file a disclosure in a month, after the company maps out further details of this plan.

Industry analysts claimed that the spin-off is not only part of efforts to become a holding company, but also part of Hankook Tire chairman Cho Yang-rai’s succession plan for his children.

Hankook Tire, which has a 6.7 trillion won ($5.9 billion) market cap, has already filed an application to the Korea Exchange for a re-listing review as it seeks to transform itself into a holding company.

The 75-year-old Yang-rai, whose brother is Hyosung chairman Cho Suck-rai, has a majority 15.99 percent stake in Hankook Tire, while his four children own a combined 19.18 percent stake in the company. The chairman’s family holds a combined stake of more than 35 percent, according to a regulatory filing.

Cho has been forced to pursue a succession plan as he is now well past retirement age, analysts claimed. Also, they speculated that Cho’s two sons ― Hyun-shick and Hyun-bum, both presidents of Hankook Tire ― are expected to increase their ownership in the company amid a possible restructuring.

Hankook Tire, the de-facto holding company, has 20 subsidiaries, including Atlasbx and Emfrontier. It is Korea’s largest tire maker with a market share of greater than 56 percent.

The company’s net profit fell to 355 billion won in 2011, from 463 billion won a year ago, while its sales reached 6.5 trillion won last year, up from 5.4 trillion won a year earlier, according to financial statements.

Its shares ended up 100 won, or 0.23 percent, at 44,100 won on Friday.

By Park Hyong-ki (hkp@heraldcorp.com)