The question of who will take over Tong Yang Group, one of Korea’s largest conglomerates, finally has an answer: the owner’s son. The group’s current chairman, Hyun Jae-hyun, appears ready to hand enough shares over to his son to make the younger Hyun the group’s de facto owner. The move would end speculation about the group’s future and help it achieve stability.
Hyun Seung-dam owns a 20 per cent stake in Tong Yang Leisure, which has become the major shareholder in two affiliates: cement maker Tong Yang Major Corp and Tong Yang Investment Bank. The result is that the wing of the group that manages its golf course is the group’s virtual holding company. Mr. Hyun, 25, is a university student and does not currently hold any position in the group.
Tong Yang Leisure, which operates two golf courses, financed the purchase of the shares by selling some of the land on the courses to Tong Yang Life Insurance. After selling 60 billion won ($58 million) worth of land at the Pine Valley Country Club in Samcheok, Gangwon province, in late May, Tong Yang Leisure bought shares in Tong Yang Major, becoming the firm’s largest stakeholder in June. In March 2004, Tong Yang Leisure sold more than 150 billion won of land in Pine Creek Country Club in Anseong, Gyeonggi province, and two months later acquired over 4 million shares in Tong Yang Investment Bank from Tong Yang Major to become the top stakeholder at that firm, as well.
Tong Yang Major, which sold the rest of the shares to other companies, explained that improving its financial structure by paying off outstanding debts was a critical part of the move. In the process, Tong Yang Group has benefited from the increasingly stable standing of Tong Yang Major the group’s spokesman said the company’s debt ratio continues to fall and also from a clearer idea of who will succeed the elder Hyun. Tong Yang Capital sold its 50 percent share in Tong Yang Leisure yesterday to Mr. Hyun, who now has 80-percent stake in the golf course operator.