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Korean Air CEO says discussions with family members about company are ongoing
[SEOUL] The CEO of Korean Air Lines said on Monday that discussions with family members about the airline are ongoing, after the sudden death of its patriarch in April raised questions about its future and of its parent Hanjin Group.
Walter Cho, the 43-year-old son of the late chairman Cho Yang-ho, assumed leadership of the country's aviation-to-logistics conglomerate Hanjin Kal Corp after his father's death.
But it has yet to file with the country's regulators about who will be the official chief of the group that also operates hotels, logistics and budget airlines. The CEO's mother and two sisters own stakes in Hanjin Kal.
"He has told us harmony among the family members is the most important thing and what we have to achieve by harmony is to protect the company," Cho told reporters during a briefing held at the IATA annual meeting in Seoul, referring to his late father.
The late tycoon died of a chronic illness just weeks after shareholders ended his 27-year tenure on the board of the airline due to perceived leadership failings.
Cho's inheritance of the position brings with it challenges, including keeping his family's grip on an aviation-to-logistics conglomerate from a local activist fund, which has recently boosted its stake in Hanjin Kal to nearly 16 percent.
Senior Cho held a 17.8 per cent stake in Hanjin Kal. Cho, his relatives and the family's academic foundations own a total 29 per cent of the holding firm.
Inheritance tax the family needs to pay may amount to around 170 billion won (S$203 million), worth half the entire Hanjin stake held by Cho, some analysts estimate.
Asked about the inheritance tax and management rights, Cho declined to comment on specifics.
Analysts say the death raises the possibility of a bidding war over the 70-year-old patriarch's stake in Hanjin Kal, but his family would fight to defend control of the airline.