Often found at theaters and museums, Kwon Mee-yoo has covered a wide range of cultural fields from K-pop and dramas to theater and fine art for over a decade. Now as K-Culture Desk editor, she tries to connect Korean culture with global readers through fresh perspectives.
Hanwha escapes stock trading suspension
By Kwon Mee-yoo
Hanwha Corporation narrowly escaped a suspension of its stock Sunday despite the latest embezzlement case involving its chairman and other executives.
"We decided not to review Hanwha for a possible delisting because we found the firm's transparency improvement plan feasible," Cho Jae-doo, a director at the Korea Exchange (KRX), said at a press conference. He added that the decision was made to stabilize the market and protect investors.
The prosecution announced Friday evening that company Chairman Kim Seung-youn and other officials had been indicted for embezzlement.
Originally, the KRX said it would suspend trading of Hanwha's stock from today and hold a possible delisting review Friday. However, it quickly reversed its position.
Usually a review for delisting takes about two weeks, but the KRX continued discussions over the weekend and announced its decision after accepting the company’s corporate reform plan.
The KRX said Hanwha submitted a plan to improve managerial transparency by reinforcing internal control on related transactions, and it decided the plan was workable.
Kim and 10 other executives are suspected of misappropriating some 640 billion won in funds from the Hanwha Group and using it to pay for the debts of other firms.
The prosecution will seek a nine-year jail term for Kim when the case goes to trial.
The total, damage to Hanwha Corporation is estimated to reach 89.9 billion won, equivalent to 3.9 percent of the firm's equity. Listed companies are obliged to announce suspected embezzlement or misappropriation cases when losses total over 2.5 percent of their equity, according to KRX regulations.
Hanwha has also been placed on an unfaithful disclosure list, as it only reported the information on embezzlement Friday despite receiving an arraignment notice from the prosecution on Feb. 11, 2011.