S.Korea's Hankook Tech Chairman Sells Entire Stake to Younger Son
The parent of South Korea’s top tyre maker Hankook Tire & Technology said its chairman had sold his stake in the group to his younger son, driving its shares up 30% as investors bet this could lead to a family feud over ownership.
Hankook Technology Group Co Ltd Chairman Cho Yang-rai has sold his 23.59% stake in a block deal to Cho Hyun-bum, who heads the tyre maker, making junior Cho the largest shareholder with a nearly 43% stake in the parent company, a regulatory filing showed on Tuesday.
His older brother Cho Hyun-shick, vice chairman of the parent firm, holds a 19.32% stake, while their two sisters who have a 10.82% and 0.83% stake each, Reuters reported.
Hankook Tire is among the world’s top 10 tyre makers, whose customers include Hyundai Motor Co, Ford Motor Co and Volkswagen.
The firm did not disclose the deal value. The stake was worth 269 billion won ($225 million) as of Monday’s close.
A spokesman for Hankook Tire said the brothers would continue to run the group.
The group’s shares rose as much as 30% after local media reported the stake sale, fuelling expectations of a ownership tussle, while Hankook Tire, worth $2.4 billion, rose nearly 4%.
“The stock is up not because of the company’s fundamentals, but because of bets on which Cho brother would win control,” said Chung Moon-su, a Hyundai Motor Securities analyst.
“Founding family members could take action to fight for the group’s management by aggressively buying up shares, which would also drive up the stock price.”