The Korea Times

POSCO freezes employee salaries

By Lee Hyo-sikKwon Oh-joon,POSCO chairmanPOSCO, the world’s fourth-largest steelmaker, has decided to freeze the salaries of its workers this year and use the money to purchase gift certificates to help boost the profits of small merchants at traditional markets.The company also said it will set up a task force to overhaul its performance-based compensation system and hire 6,400 entry-level workers as planned, despite its ongoing downsizing drive.It will extend its peak wage system, which cuts an employee’s salary at a certain age in return for job security, as the legally binding retirement age rises to 60 in 2016 from the current 58.“Both labor and management decided not to raise wages this year as part of efforts to overcome the ongoing difficulties, and share growth with business partners and local communities,” a POSCO spokesman said.“We expect to save about 13 billion won from the wage freeze. We will use the money to purchase traditional market gift certificates, worth 13 billion won, and give them to our employees and those of our business partne

Aug 26, 2015By Lee Hyo-sik

Companies

Creditors in dilemma over sales of Kumho Industrial

By Lee Hyo-sikThe state-run Korea Development Bank and other creditors of Kumho Industrial are in a quandary about what price to dispose of their 57.5 percent stake in the holding company of Kumho Asiana Group.The creditors have been demanding that Kumho Group pay 1.02 trillion won ($833 million) for the stakes, or 59,000 won per share, including a premium for management rights and the firm’s stakes in other group affiliates.However, Kumho Chairman Park Sam-koo, who has been trying to rebuild his fallen empire over the past five years, insists that he cannot pay more than 650.3 billion won for the stakes, or 37,564 won per share.Park has been arguing that creditors have become greedy, seeking to receive more than what Kumho Industrial is worth.After failing to narrow the price gap with Kumho Group over the past two months, creditors have begun discussing whether to accept or reject Park’s offer.“We are currently collecting opinions from 22 creditors that own more than a 0.5 percent stake in the company,” a KDB spokesman said. “We are asking about whether

Aug 25, 2015By Lee Hyo-sik

Companies

KOTRA to provide 'tailored' marketing

KOTRA CEO Kim Jae-hongBy Lee Hyo-sikThe Korea Trade-Investment Promotion Agency (KOTRA) plans to implement country-specific marketing to help exporters more effectively boost their shipments, the head of the state-run export promoter said Tuesday.In China and Southeast Asia, the agency plans to organize large-scale trade fairs using “hallyu,” or the Korean cultural wave, to promote a wide range of made-in-Korea goods for increasingly wealthy consumers there.In the Middle East and South America, KOTRA will more actively engage with business people that showed an interest in doing business with Korean firms when President Park Geun-hye visited the two regions in the first half of the year.In Japan, the agency will promote Korean products on the 50th anniversary of Korea-Japan diplomatic relations. It also will target the growing Latino population in the United States.“In the second half of the year, KOTRA will introduce marketing programs tailored to each foreign market in order to help increase Korea’s outbound shipments,” KOTRA CEO Kim Jae-hong said. &ld

Aug 25, 2015By Lee Hyo-sik

Companies

Jeju Air's IPO may stumble on sluggish market

By Lee Hyo-sikJeju Air, Korea’s largest low-cost carrier by revenue, has taken the first steps to become a publicly traded entity this year by asking the stock market operator to check whether it is fit to be listed on the local bourse.The carrier decided to go public, thinking that its shares will be well received by investors, expressing hope that it will secure enough funds to more effectively compete with the country’s two flagship carriers ― Korean Air and Asiana Airlines.Jeju Air has been flying high over the past few years riding on the surging travel demand.Unless Middle East Respiratory Syndrome (MERS) and other unforeseen risks discourage people from traveling in the second half of the year, the company is expected to post a handsome performance in the second half. Low oil prices will also improve its bottom line.However, some question the timing of the initial public offering (IPO), citing the overall sluggish stock market conditions. The local bourse is widely expected to remain weak throughout the year as many investors stay away from the bourse because

Aug 24, 2015By Lee Hyo-sik

Companies

Inter-Korean shares rebound

By Lee Hyo-sikShares of companies in inter-Korean businesses rebounded sharply Monday on eased tensions between the two Koreas, following talks between high-ranking government officials from both sides.Last week, inter-Korean stocks tumbled, weighed down by the escalating military confrontation between the two Koreas.Analysts say if the South and North take concrete steps to ease heightened tension on the Korean Peninsula, shares of inter-Korean businesses will likely head upward.But they caution that their ascent will be limited, given the overall market slump caused by the slowing Chinese economy, the planned U.S. interest rate hike and other external negatives.“Shares of inter-Korean companies rose Monday, mainly on a technical rebound,” said Daniel Cho, head of research at Daishin Securities. “On Aug. 20-21, the stocks plunged on the aggravating inter-Korean relations. It is really hard to project how things unfold as far as inter-Korean matters are concerned. But given what has happened in the past, the two Koreas will not choose a path toward further confronta

Aug 24, 2015By Lee Hyo-sik

Companies

Lotte most aggressive chaebol in M&A

By Lee Hyo-sikLotte Group, Korea’s fifth-largest family-controlled conglomerate, has been most aggressive in acquiring companies over the past five years, expanding its reach across retail, confectionary, construction, logistics, chemical and other industries.According to Chaebol.com, a corporate research information provider, Monday, Lotte took over 19 firms from 2010 through 2014, the largest among the country’s top 10 business groups. The group had a total of 81 affiliates last December.Of the 19, the conglomerate acquired Himart, Korea’s largest electronics retailer, in December 2012 and changed its name to Lotte Himart. In 2010, the group took over convenience store franchise By The Way and integrated it into its Seven Eleven chain.Not only Lotte, but other conglomerates have been active acquiring other businesses to boost the competitiveness of their existing units or advance into high-growth sectors.GS Group, the seventh-largest group specializing in refinery, retail and construction, acquired 15 companies such as Incheon Energy from 2010 to 2014, while LG Gr

Aug 24, 2015By Lee Hyo-sik

Companies

Porsche, Ferrari buyers may pay more taxes

By Lee Hyo-sikPorsche, Ferrari, Maserati and other foreign luxury auto brands will likely suffer sales declines if proposed changes to the country’s tax codes go into effect, according to auto industry analysts, Friday.A ruling party lawmaker has proposed a revision to the tax codes governing automobiles, which currently imposes an auto tax on motorists in accordance with the engine size of their vehicles. The revision calls for levying taxes based on the value of vehicles.If realized, owners of high-priced foreign vehicles will have to pay significantly higher taxes than they do now, adversely affecting the sales of luxury car makers.Rep. Shim Jae-chul of the ruling Saenuri Party said Friday that he will soon forward a revised local tax bill to the National Assembly for approval, seeking to change the guidelines on how municipal governments tax motorists every year.“The current auto tax codes are unfair to individuals who drive low-priced vehicles, mostly produced by domestic automakers, because they pay taxes based on the size of engine, not the value of vehicles,&rdquo

Aug 21, 2015By Lee Hyo-sik

Porsche, Ferrari buyers may pay more taxes

Companies

SK chief touts 'field management'

SK Group Chairman Chey Tae-won, second from left, tours a SK hynix plant in Icheon, Gyeonggi Province, Wednesday. Chey has focused on “field management,” visiting group units across the country, since Aug 14 when he was released from prison on a presidential pardon. / Courtesy of SK GroupBy Lee Hyo-sikSK Group Chairman Chey Tae-won has mostly been on the road to visit group affiliates and business partners since he was released from jail on a presidential pardon a week ago.His rigorous “field management” is seen as a move to quickly retake control of the country’s third-largest conglomerate centering on semiconductors, energy and telecommunications, after his three-year absence.According to SK officials Thursday, the chairman is expected to wrap up his domestic tour of group units by the end of this month.He will then embark on an extensive overseas trip to tour SK operations in China and other countries, they said. While abroad, Chey will also likely meet with heads of states and CEOs of SK’s business partners.On Thursday, he went to the Ulsa

Aug 20, 2015By Lee Hyo-sik

People & Events

Hyungji chairman gets top CEO award

Choi Byung-ohHyungji Group ChairmanBy Lee Hyo-sikHyungji Group Chairman Choi Byung-oh was selected Thursday as the CEO of the Year for transforming his 30-year-old company into one of Korea’s fashion powerhouses.The Korea Academic Society of Business Administration, which represents hundreds of scholars majoring in the areas of business administration, chose Choi as the top CEO among the heads of mid-size enterprises.The organization said the Hyungji chairman set a good example for younger entrepreneurs in turning dreams into reality, It said Choi is a successful self-made entrepreneur creating what Hyungji is today from scratch over the past three decades.“It is such an honor to be named as the 2015 CEO of the Year of mid-sized enterprises by a group of business management professors,” Choi said. “This award further reminds me of my initial resolution, which is to create a sustainable corporation that makes contributions to society. I will spare no effort to continue to do so.”Choi has also been serving as the chairman of the Korean Apparel Industry Ass

Aug 20, 2015By Lee Hyo-sik

Companies

Another Lotte unit under tax audit

By Lee Hyo-sikThe head office of Lotteria is shown in Yongsan, Seoul, Wednesday. The National Tax Service (NTS) conducted a month-long tax probe into the fast food chain arm of Lotte Group. / YonhapA Lotte Group’s fast food franchise was found Wednesday to have been audited by the tax agency, igniting speculation that agency may expand its investigation to other Lotte affiliates.The latest tax audit of Lotteria came after the unprecedented sibling feud over management has exposed the conglomerate’s opaque governance structure and outdated business practices.The National Tax Service (NTS) has already been conducting an audit of Daehong Communications, Lotte’s public relations unit.According to Lotteria, NTS officials visited the company headquarters in Seoul early July and confiscated financial documents and other materials. Company officials said the probe ended in early August and they haven’t yet been informed of any probe results.“It is true that we underwent the NTS audit,” a Lotteria official said. “But it has nothing to do with the ongo

Aug 19, 2015By Lee Hyo-sik

Lee Hyo-sik

Read more

POSCO freezes employee salaries

Creditors in dilemma over sales of Kumho Industrial

KOTRA to provide 'tailored' marketing

Jeju Air's IPO may stumble on sluggish market

Inter-Korean shares rebound

Lotte most aggressive chaebol in M&A

Porsche, Ferrari buyers may pay more taxes

SK chief touts 'field management'

Hyungji chairman gets top CEO award

Another Lotte unit under tax audit

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