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| LG splits its subsidiaries into a new conglomerate |
South Korean company LG announced on Thursday that its board of directors decided to reorganize its LG group of companies and include some of its subsidiaries, such as B. Silicon Works, a manufacturer of diaposites, to split to form a new group next year.
This is the latest result of a series of transactions and restructuring passed on from generation to generation as the Korean family business group continues to grow.
The restructuring is also expected to help alleviate organizational pressure to reduce intra-group transactions in family business groups.
LG's regulatory documents show that Koo Bon-joon is the CEO of the new holding company.
Koo Bon-joon is the third son of late Honorary Chairman of LG Group (Koo Cha-kyung) and younger brother of Chairman of LG Group (Koo Bon-moo).
Jun took over the branch business of his nephew Ku Kwang Mu. His father became Chairman of LG Group after his death in 2018.
Since the deaths of Koo Bon-moo and his adopted son Koo Kwang-mo, he is considered the leader of the group that is the traditional successor.
Komoto Jun controls 7.72% of LG's parent company.
LG Group is the fourth largest conglomerate in South Korea. The primary business includes consumer electronics, chemicals, household products, and cosmetics, as well as spare parts such as batteries and product displays. Tesla and Apple.
The approval documents say: The subsidiaries that will be separated in May 2021 also include LG International trading company, diversified building materials manufacturer LG Hausys and chemical manufacturer LG MMA.
The restructuring also includes a subsidiary of Pantos Logistics as 64% of the logistics company's 2019 sales come from other subsidiaries of LG Group, including LG Electronics and LG Chem.
LG Group has highlighted a rare case of peaceful succession from generation to generation in a Korean family business, where LG adheres to the principle of handing over power to the president's eldest son if a change in leadership occurs since its inception.