LG unveils $179M fund to aid SMEs

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LG unveils $179M fund to aid SMEs

Amid pressure from the new administration on large enterprises to step up investment, LG, the nation’s fourth-largest conglomerate, yesterday unveiled a plan to establish a 200 billion won ($179.3 million) fund to help about 500 business partners of four of its affiliates.

The four companies - LG Electronics, LG Display, LG Chem and LG Household & Health Care - will be able to provide loans from the so-called “mutual growth fund” to partners at interest rates of 1.9 percent to 2.4 percent lower than those of commercial banks. The fund will be managed by the Industrial Bank of Korea. The approval process will be streamlined and the loan periods can be extended, according to LG.

The fund is aimed at “preventing our partners from losing the opportunities to expand due to lack of capital,” said LG in a statement.

Several other LG affiliates already run a 250 billion won mutual growth fund for business partners and as of yesterday three more - LG Innotek, LG Hausys and LG U+ - joined the fund, raising its size to 340 billion won. In total, LG will operate 540 billion won in funds for smaller companies that do business with affiliates.

Meanwhile, Samsung Chairman Lee Kun-hee yesterday showed up at the Seocho building in southern Seoul, 10 days after he returned from a nearly three month trip to Japan and Hawaii. He arrived about 8:30 a.m. Last time he appeared at Seoul headquarters was Nov. 30, when he dined with employees who were presented with Samsung Awards. He did not make a statement yesterday, since he entered the building through an underground route instead of through the lobby, where many reporters have been waiting for him. On the day of his return April 6, the 71-year-old business mogul pledged to “help out the government,” without providing details.

Blue House sources said yesterday Lee is highly likely to accompany President Park Geun-hye on her first official visit to the United States next month. The last time the chairman went on a president’s overseas trip was September 2004.

By Seo Ji-eun [spring@joongang.co.kr]
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