Taking Their Breathes
The Korean business world heaved a sigh of relief once as the Special Investigation Team announced that it was impossible for them to look into other big companies other than Samsung, considering the officially given period for its investigation into Choi Soon-sil’s involvements of government affairs.
"The current remaining investigation period is not long enough and will disable us from investigating other big companies," said Lee Gyu-cheol, an assistant special prosecutor and the spokesman of the team on February 14. "There is no formal investigation into other large corporations."
"There is nothing to make a comment on," said a spokesperson of the SK Group which had been expected to be picked as the next investigation target after the Samsung Group. The SK Group has been suspected of donating 11.1 billion won (US$9.3 million) to the Mir and K Sports Foundations in return for a special presidential pardon of SK Chairman Chey Tae-won in 2015.
The POSCO Group also had time to take a breather. POSCO Chairman Kwon has been questioned by prosecutors for an allegation that he was involved in a close aide of Choi Soon-sil, Cha Eun-taek’s attempt to deprive advertising affiliate POREKA of the POSCO Group last year.
Some people say that if the investigation period is extended, there is a possibility that the other companies will be on the radar of the Special Prosecution Team again so the other companies ought to be abstained from making wrong judgments and jumping to conclusions. This is because even if the Special Prosecution Team’s investigation period is not spun out, the investigation is likely to be resumed because the case will be transferred to the prosecution. "We are maintaining the same old position that a new permit for our duty-free shop has nothing to do with our donation of money to the Mir Foundation," said an official of Lotte Group. "We are still watching the situation closely and cannot loosen up."
However, as the Special Prosecution Team officially announced that their investigation will not be conducted on the other large corporations, it is unlikely that the team will summon the heads of the other large companies. Therefore, it is expected that those companies will be able to resume various corporate activities such as delayed management planning, organizational restructurings and new business development.
This year, the SK Group plans to invest 17 trillion won (US$14.5 billion), a 21% increase from last year. The group has decided to invest 11 trillion won (US$9.3 billion) in domestic facilities such as SK Hynix's NAND flash factory in Cheongju, Korea and to spend 4.9 trillion won (US$4.2 billion) in strategic investments such as mergers and acquisitions. As most projects are so big and important that they should be approved by chairman Chey Tae-won, it is anticipated that if chairman Choi relieves the burden of being grilled by the Special Investigation Team, the SK Group’s investment will proceed in earnest. The POSCO Group is also expected to shell out 3.5 trillion won (US$3.0 billion) for its investment projects including an upgrade of its steelworks and the development of new materials such as lithium. It the Special Prosecution Team gets the POSCO off the hook, its planned projects are expected to gain big momentum.
The CJ Group which was suspected of providing funds to foundations controlled by Choi Soon-sil or cooperating with the government in exchange for a presidential pardon of the group’s chairman Lee Jae-hyun, is also expected to carry out an executive reshuffle and a restructuring that have been delayed. As the CJ Group has made up its mind to invest 5 trillion won (US$4.3 billion) with this year as the first year of its invasion of global markets such as M&As, the group will do all its powers permit to minimize a managerial vacuum set off by chairman Lee’s battle with a disease, arrest and pressures from the government and rebuild its decision-making system.