South Korea’s LG Group chairman dies from illness at 73

LG Group chairman Koo Bon-moo meets US President Barack Obama (not pictured) as they attend the groundbreaking of a factory for Compact Power Inc. in Holland, Michigan, US. (Reuters)
Updated 20 May 2018
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South Korea’s LG Group chairman dies from illness at 73

  • The chairman of South Korea’s LG Group, Koo Bon-moo, passed away on Sunday after a year-long battle with brain disease
  • Prior to its chairman’s death, LG Group had established a holding company in order to streamline ownership structure and begin the process of succession

SEOUL: The chairman of South Korea’s LG Group, Koo Bon-moo, instrumental to transforming the country’s fourth-largest conglomerate into a global brand, passed away on Sunday after a year-long battle with brain disease.
LG Group said in a statement Koo, 73, had been ill for a year.
A group official said Koo had been fighting a brain disease and had undergone surgery. The official declined to be named due to the sensitivity of the matter.
“Becoming the third chairman of LG at the age of 50 in 1995, Koo established key three businesses — electronics, chemicals and telecommunications — led a global company LG, and contributed to driving (South Korea’s) industrial competitiveness and national economic development,” LG said.
Under Koo’s leadership, the conglomerate changed its corporate brand to LG from Lucky Goldstar and sold LG’s semiconductor business to Hyundai, now SK Hynix Inc, under government-led restructuring in the wake of the Asia financial crisis in the late 1990s.
Major affiliates are LG Electronics Inc, display maker LG Display and electric car battery maker LG Chem.
Prior to its chairman’s death, LG Group had established a holding company in order to streamline ownership structure and begin the process of succession.
The country’s powerful family-run conglomerates are implementing generational succession amid growing calls from the government and public to improve transparency and corporate governance.
LG Corp, a holding company of the electronics-to-chemicals conglomerate, said on Thursday its longtime chairman was unwell and planned to nominate his son to its board of directors in preparation for a leadership succession.
Heir apparent Koo Kwang-mo is from the fourth generation of LG Group’s controlling family. He owns 6 percent of LG Corp. and works as a senior official at LG Electronics.
The senior Koo’s younger brother, the group’s vice chairman Koo Bon-joon, who led LG Electronics for many years, effectively managed the conglomerate in his stead.
South Korean prosecutors said this month they raided LG Group’s head office as part of a probe into alleged tax evasion by family members controlling the conglomerate.
Analyst do not see a change at the helm being disruptive to the group’s business.
“Although Koo passed away at a relatively early age, his son has been already in a senior position and I don’t think there will be a big change in governance structure or strategic decisions,” said Park Ju-gun, head of corporate analysis firm CEO Score.
The company said Koo’s funeral would be held privately at the request of the family.


US in criminal probe of China's Huawei

Updated 15 min 41 sec ago
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US in criminal probe of China's Huawei

  • The Wall Street Journal said the US justice department is looking into allegations of theft of trade secrets from Huawei's US business partners
  • Huawei forcefully denied accusations that his firm engaged in espionage on behalf of the Chinese government

WASHINGTON: US authorities are in the "advanced" stages of a criminal probe that could result in an indictment of Chinese technology giant Huawei, a report said Wednesday.
The Wall Street Journal, citing anonymous sources, said the Department of Justice is looking into allegations of theft of trade secrets from Huawei's US business partners, including a T-Mobile robotic device used to test smartphones.
Huawei and the Department of Justice declined to comment on the media report.
However, Huawei noted that "Huawei and T-Mobile settled their disputes in 2017 following a US jury verdict finding neither damage, unjust enrichment nor willful and malicious conduct by Huawei in T-Mobile's trade secret claim."
The move would further escalate tensions between the US and China after the arrest last year in Canada of Huawei's chief financial officer Meng Wanzhou, who is the daughter of the company founder.
The case of Meng, under house arrest awaiting proceedings, has inflamed US-China and Canada-China relations.
Two Canadians have been detained in China since Meng's arrest and a third has been sentenced to death on drug trafficking charges -- moves observers see as attempts by Beijing to pressure Ottawa over her case.
Huawei, the second-largest global smartphone maker and biggest producer of telecommunications equipment, has for years been under scrutiny in the US over purported links to the Chinese government.
Huawei's reclusive founder Ren Zhengfei, in a rare media interview Tuesday, forcefully denied accusations that his firm engaged in espionage on behalf of the Chinese government.
The tensions come amid a backdrop of President Donald Trump's efforts to get more manufacturing on US soil and slap hefty tariffs on Chinese goods for what he claims are unfair trade practices by Beijing.
In a related move, lawmakers introduced a bill to ban the export of American parts and components to Chinese telecom companies that are in violation of US export control or sanctions laws -- with Huawei and fellow Chinese firm ZTE the likely targets.
"Huawei is effectively an intelligence-gathering arm of the Chinese Communist Party whose founder and CEO was an engineer for the People's Liberation Army," said Republican Senator Tom Cotton, one of the bill's sponsors.
Democratic Senator Chris Van Hollen said in the same statement: "Huawei and ZTE are two sides of the same coin. Both companies have repeatedly violated US laws, represent a significant risk to American national security interests and need to be held accountable."
Last year, Trump reached a deal with ZTE that eases tough financial penalties on the firm for helping Iran and North Korea evade American sanctions.
Trump said his decision in May to spare ZTE came following an appeal by Chinese President Xi Jinping to help save Chinese jobs.