Conglomerates' insider stock ownership rises this year

All News 12:00 September 07, 2022

SEOUL, Sept. 7 (Yonhap) -- Insider stock ownership at South Korea's family-run conglomerates rose this year as more founding members and their families tried to tighten their grip on management, the antitrust regulator said Wednesday.

The insider stock ownership rate of 66 conglomerates that have group owners reached 59.9 percent this year, up 1.9 percentage points from a year earlier, according to the Fair Trade Commission (FTC).

Insider stock ownership refers to the stocks held by the founding members and his or her immediate family and top executives of companies affiliated with a business group. This includes stakes held by subsidiaries and related financial firms.

The FTC said 76 business groups with assets of 5 trillion won (US$3.6 billion) or more are required to report details on their ownership structures this year. The insider stock ownership rate for all of the 76 business groups came to 60.4 percent this year, up from 58.1 percent for the 71 groups under supervision a year ago.

Group founding members and their family members control the entire business group via cobweb-like stock holdings in affiliates. This year, they held an average of 3.7 percent stake in business groups and 53.3 percent in affiliates, the FTC said.

Of the 66 conglomerates that have group owners, 12 business groups, including SK, Hyundai Motor Group and Lotte Group, saw their owner families hold 20 percent or more stakes in 38 overseas affiliates.

As for top conglomerate Samsung Group, the insider stock ownership rate came to 51.71 percent for 2022, up 6.58 percentage points from the previous year.

Energy-to-telecom giant SK Group saw the rate rise 0.29 percentage point on-year to 60.70 percent. The corresponding rate of automaking group Hyundai Motor Group reached 54.42 percent, up 1.81 percentage points from a year ago.