Kumho chairman's control of Asiana Airlines validated

By Lee Hyo-sik

Kumho Asiana Group Chairman Park Sam-koo will continue as CEO of Asiana Airlines as the court has ruled his appointment legally valid.

The latest ruling deals a blow to his younger brother and Kumho Petrochemical Group Chairman Chan-koo who has been trying to strip the elder Park of his influence over the country’s second-largest flagship carrier.

Seoul Southern District Court ruled Monday that the decision by Asiana Airlines shareholders in March 2014 to appoint Sam-koo as its co-CEO was legitimate, dismissing a suit filed by Kumho Petrochemical.

Following last year’s shareholder’s meeting, the chemical company filed a complaint against the carrier, insisting the latter’s decision-making process was flawed, meaning Sam-koo’s appointment was invalid.

Shareholders, led by Kumho Industrial which holds a 30.1 percent stake in Asiana Airlines, elected Kumho Group Chairman as co-CEO along with Kim Soo-cheon.

However, Kumho Petrochemical, the second-largest stakeholder with 12.61 percent, opposed the appointment. It argued that the carrier did not properly check a list of shareholders present at the meeting and should have put Sam-koo’s appointment to a vote.

The company also said its representative was denied a right to speak, claiming that the shareholders’ meeting was procedurally flawed.

However, the court ruled that Asiana Airlines properly counted the number of shareholders present at the gathering, adding that the firm has authority to limit shareholders’ rights to speak in order to maintain order.

Kumho Asiana Group hailed the court decision.

“We are glad that the court reached a logical conclusion. This proves that any attempt to invalidate Asiana’s shareholders’ meeting will not succeed,” a group spokesman said.

When asked by The Korea Times, Kumho Petrochemical Group said it has not decided yet as to how it will proceed from here.

“We haven’t decided whether we will take the case to a higher court. Nothing has been decided yet,” a group spokesman said.

The two siblings have engaged in a series of legal battles, blaming each other for the group’s fall from grace, since 2010 when Kumho Petrochemical was separated from Kumho Asiana.

Kumho Asiana Group fell into crisis in 2009 after it had borrowed an excessive amount of money to acquire Daewoo Engineering & Construction and Korea Express.

The group had to dispose of the builder and the ground-based logistics firm to help ease its financial hardship. Its creditors then subjected Kumho Industrial and other group units to a stringent workout program in return for financial assistance.