LG Finally Abandons Semicon Business

LG finally abandoned its semiconductor business.
Koo Bon Moo, chairman of LG Group, met President Kim Dae Jung on January 6 at Chong Wa Dae and agreed that LG would hand over LG Semicon Co. to Hyundai.
'LG decided to compeletely give up its management control to Hyundai Electronics Ind.,' said Kang Yu Shik, LG's restructuring chief on the same day.
Chong Wa Dae's spokesman Park Jie Won quoted LG Chairman as saying, 'LG decided to actively participate in the chaebol's restructuring to help Korea's economy to attract more credibility from abroad.'
'President Kim appreciated LG's decision from the bottom of his heart,' he added.
The merger of Hyundai Electronics and LG Semicon will give rise to the world's second largest memory chip maker with a market share of 15.7 percent after Samsung Electronics which accounts for an 18.8 percent slice as of the end of 1997.
Hyundai Electronics immediately welcomed the LG decision, saying it will develop the merged company into the world's leading producer of DRAMs.
In expectation of LG's decision, Hyundai Eletronics prepared to merge with LG Semicon.
Hyundai Electronics announced on January 6 that it will separate non-semiconductor businesses from the company to focus more on the semiconductor industry after merging with LG Semicon.
To do so, Hyundai said that it will send over non-semiconductor operations of Hyundai Electronics to a new company which the group will set up by the end of April.
Hyundai had been emphasizing repeatedly that the equity structure for the merger with LG will have to be Hyundai 7 to LG 3.