[Alpha Biz= Reporter Kim Minyoung] Over 5 Trillion Won Worth of Stocks Sold by Major Korean Conglomerate Families in 18 Months

In the past 18 months, the families of major Korean conglomerates have sold over 5 trillion won worth of their affiliate company stocks. This trend has been particularly driven by the Samsung family, with the three daughters alone selling approximately 3.3 trillion won in shares to pay for inheritance taxes.

According to the data from CEO Score, a corporate research institute, the disposal of stocks by family members of the heads of 71 conglomerates with identifiable controlling shareholders amounted to 5.067 trillion won from January 2023 to June this year.

The Samsung family led the sales, with Hong Ra-hee, former director of the Leeum Museum of Art, and her daughters Lee Boo-jin, president of Hotel Shilla, and Lee Seo-hyun, president of Samsung C&T's fashion division, selling a combined total of 3.3157 trillion won in shares.

Hong Ra-hee sold 1.4052 trillion won worth of Samsung Electronics shares, while Lee Boo-jin sold 1.1500 trillion won, including shares in Samsung Electronics, Samsung SDS, Samsung C&T, and Samsung Life Insurance. Lee Seo-hyun sold 760.6 billion won in shares, including Samsung Electronics and Samsung SDS.

This large-scale disposal of shares is likely due to the need to cover the significant inheritance tax burden following the death of the late Chairman Lee Kun-hee in 2020. The Samsung family is using an installment payment system to divide the approximately 12 trillion won inheritance tax into five annual payments starting from April 2021.

However, it was reported that Lee Jae-yong, the chairman of Samsung Electronics, did not sell any of his shares.

Following the Samsung family, the Hyundai Department Store Group made significant stock sales, with Chairman Chung Ji-sun selling 180.9 billion won worth of Hyundai Department Store shares. Cho Hyun-sang, vice chairman of HS Holdings, sold 135.9 billion won in shares as part of the group’s restructuring and separation process.

Other notable sales included Chung Kyung-sun, vice chairman of Hyundai Department Store Group (101.7 billion won), Jang Se-joo, chairman of Dongkuk Steel Group (93.8 billion won), Yoon Suk-min, chairman of Taeyoung Group (77.6 billion won), Choi Sung-hwan, head of SK Networks' business division (72.0 billion won), and Shin Young-ja, chairwoman of the Lotte Foundation (67.6 billion won).

On the other hand, the acquisition of shares by conglomerate family members totaled just over 1 trillion won, with Hyundai Department Store Group (322.2 billion won), OCI Group (193.8 billion won), and Dongkuk Steel Group (181.8 billion won) accounting for about 60% of the total.

These acquisitions were driven by factors such as the shift to a holding company structure and group restructuring, leading to large-scale acquisitions through rights issues and tender offers.

Inheritance and gifting of shares also continued, with the total value amounting to 1.2134 trillion won over the past 18 months.

The most significant inheritance and gifting occurred within the Hyosung Group, where the late honorary chairman Cho Suck-rai's shares in five affiliates, including Hyosung and Hyosung Heavy Industries, worth 788 billion won, were inherited by his sons, Chairman Cho Hyun-joon (613.5 billion won) and Vice Chairman Cho Hyun-sang (174.5 billion won).

Hansol Group, which is preparing for a third-generation succession, followed with Chairman Cho Dong-hyuk transferring 78.7 billion won in Hansol Chemical shares to his eldest daughter, Vice Chairman Cho Yeon-joo.

Amorepacific Group's Chairman Suh Kyung-bae gifted 63.1 billion won worth of Amorepacific Group shares to his second daughter, Suh Ho-jung. Hyundai Green Food Chairman Chung Ji-sun transferred 52.4 billion won in shares to his wife, children, and nephew, while GS Group's Honorary Chairman and GS Engineering & Construction Chairman Huh Chang-soo gifted 31.1 billion won in GS Engineering & Construction shares to his son, President Huh Yoon-hong.

 

 

 

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