By Lee Hyo-sik
Kumho Asiana Group said Tuesday that it has taken back control of its holding company, Kumho Industrial, six years after the company was subject to a creditor-managed workout program.
In 2009, the group had to sell a controlling stake in the holding firm to the Korean Development Bank and other creditors to secure much-needed cash to cope with its worsening liquidity shortage following the 2008 global financial crisis.
Regaining the holding firm is seen as a first step for Kumho Chairman Park Sam-koo to rebuild what was once the eighth-largest conglomerate in Korea.
The group said Kumho Enterprise, an entity recently set up by Park, made a 722.8 billion won ($623 million) payment to creditors for a 50 percent plus 1 share in Kumho Industrial. It holds a 30.1 percent stake in Asiana Airlines, Korea’s second-largest flagship carrier, and a 46 percent stake in Air Busan, as well as owning Kumho Terminal and the group's headquarters building in downtown Seoul.
After a series of negotiations, Park and company creditors signed a stock purchase agreement in September.
In October, Park established Kumho Enterprise, which attracted hundreds of billions of won in investments from CJ and other business groups. Park and his family members hold a combined 67.7 percent stake in Kumho Enterprise.
“I am grateful for those who have extended enormous help to us in our endeavor to rebuild Kumho Asiana Group,” Park said. “I will continue to inherit the group founder’s spirit, which has sustained us for the past seven decades. All Kumho family members should start anew and work hard to foster our three main businesses: the airline, tires and construction.”
However, Park has a long way to go before he completes the rebuilding of his fallen empire, as he still has to take back Kumho Tire and Kumho Express Bus.
Creditors still hold a 42.1 percent stake in Kumho Tire, which graduated from a creditor-managed workout program in December 2014.
In June this year, the group took back control of Kumho Express but had to unload it to a private equity firm three months later to raise cash so they could buy back Kumho Industrial.
Kumho Asiana Group suffered a severe liquidity crisis in 2009 after it borrowed an excessive amount of money to acquire Daewoo E&C and Korea Express.