End to Management Conflict

Shin Dong-bin, the founder's second son and incumbent chairman of Lotte Group, got the final support from shareholders at the holding company.
Shin Dong-bin, the founder's second son and incumbent chairman of Lotte Group, got the final support from shareholders at the holding company.

 

Shareholders of Tokyo-based Lotte Holdings Co., which controls South Korea's fifth-largest conglomerate Lotte Group, voted again in support of Shin Dong-bin, the Lotte founder's second son and incumbent chairman, helping strengthen his management grip against his elder brother Shin Dong-joo.

According to Lotte Group on March 6, the majority of the shareholders rejected the request made by Shin Dong-joo, the oldest of Lotte founder Shin Kyuk-ho's two sons and former vice chairman, to dismiss incumbent chairman Shin Dong-bin, his younger brother, from the company's board of directors during the extraordinary shareholders meeting held at the headquarters in Shinjuku, Tokyo, on the day.

Lotte Group said that the latest shareholders' meeting virtually marks the end of the succession feud. "(The meeting) confirmed shareholders' solid support for Shin Dong-bin," a Lotte Group spokesman said. "Former Vice Chairman of Lotte Holdings Shin Dong-joo is urged to sternly accept the result of the shareholders’ meeting and to halt an act of hurting Lotte’s corporate value and undermining corporate activities.”

 Lotte Group added, “We will not "tolerate" other attempts made by the eldest son to harm the corporate value and business order. We will take strict measures against him, including legal actions.”

 In this regard, Shin Dong-joo, former vice chairman, said, “The opinion of the shareholders was not properly reflected in the decision at the meeting,” adding that he will submit the case again in the regular shareholders' gathering slated for June. In particular, he said the head of the employee shareholders’ association did not even attend the shareholders’ meeting and exercised his voting right through the power of attorney again. 

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