Aekyung, Hyundai Motor get close through marriage
As most Korean conglomerates are controlled by their founding family members, information on the close relationships of business tycoons formed through marriage could be useful for investment decisions.
Against such a backdrop, it is understandable that Korean media paid a great deal of attention to the marriage last Friday of a founding family member of Aekyung Group.
Chang Young-shin, 80, chairwoman of the mid-tier, family-controlled conglomerate, formed an in-law relationship with Hyundai Motor Group chairman Chung Mong-koo through the marriage of her granddaughter and Chung’s grandson.
Dozens of Hyundai family members attended the wedding, held at Myeongdong Cathedral in central Seoul, to celebrate the new start of Sun Dong-wook, 28, the only son of Innocean Worldwide advisor Chung Sung-yi who is the eldest daughter of the Hyundai Motor chairman.
The founding family members of Aekyung also gathered on the festive occasion to celebrate the wedding of group vice chairman Chae Hyeong-seok’s second daughter.
Aekyung was founded in 1954 by the late Chae Mong-in as a soap detergent maker, but it was the founder’s wife who advanced the small family business into a conglomerate -- with the business portfolio ranging from consumer goods to retail and airline services. In 2015, the group’s revenues reached up to about 6 trillion won ($5.3 billion).
Chang, who has led the growth of Aekyung since 1972, two years after her husband died of a heart attack, broke taboos against female leadership in a male-dominant society.
As of today, her three sons and daughter lead the group’s three main business divisions: consumer products and airlines; chemicals; and retail and property development.
When it comes to power transfer to the second generation, her eldest son -- father of the new bride -- has an upper hand, securing a 16.14 percent stake in the holding company AK Holdings.
Chae, who became vice chairman in 2000, has sought to further promote the group’s diversification by entering the low-budget carrier market with Jeju Air in 2005.
Backed by the soaring number of Korean travelers, Jeju Air grew into the nation’s third largest airline after Korean Air and Asiana Airlines last year, achieving 608.1 billion won in sales. The airline was listed on the stock market in November last year.
AK Holdings, controlled by founding family members, is the biggest beneficiary of the stock listing as it holds a 57.20 percent stake in Jeju Air.
“The jump in stock value of Jeju Air is forecast to facilitate the initial public offerings of other affiliates controlled by the holding company,” said Kang Sun-ah, a stock analyst of KB Investment & Securities.
Aekyung Industrial, the group’s flagship affiliate in which AK Holdings holds a 50.1 percent stake, is poised to debut on the main bourse early next year. The company is the country’s second largest household goods maker after LG Household and Health Care.
Capital market sources say that Aekyung also has a plan to list AK ChemTech and AK & MN BioFarm in the mid-term.
By Seo Jee-yeon (jyseo@heraldcorp.com)
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