Lotte chairman maintains grip on operationsLotte Group Chairman Shin Dong-bin is expected to maintain control over the retail giant as he has secured full backing from a key Japan-based unit in spite of the indictment laid against him on bribery charges, sources said Monday.
Shin’s leadership of Korea’s fifth-largest conglomerate has been in jeopardy as he is facing ongoing trials for alleged involvement in an influence-peddling scandal that led to the impeachment of former President Park Geun-hye.
Despite the turmoil, the board of directors of Tokyo-based Lotte Holdings Co., a pivotal company in Lotte’s governance structure, passed a resolution on May 1 to continue to uphold Shin as the conglomerate’s head, according to Lotte Group in Seoul.
The decision gives Shin, 62, firm grounds to tighten his grip on the business empire with 90 affiliates, and an upper hand in the prolonged power struggle with his elder brother Dong-joo, who has challenged him for the top post of the 50-year-old family business founded by their father in 1967.
The chairman apparently flew to Japan late last month as soon as he was cleared to travel abroad by Seoul’s justice ministry, and met with the board of directors to convince them of his leadership and cross-border management, all of which he stressed will remain intact as he will be probed without being detained, sources familiar with the matter said.
He also gave them his word he will make utmost efforts to prove his innocence over the course of the legal proceedings, according to the sources.
With confidence from Lotte Holdings, the chairman is expected to bolster his reform drive and more investment for the Japan-based Lotte, whose growth had been stalled under his father’s leadership.
As of 2016, Lotte Japan reaped 5 trillion won ($4.48 billion) in sales, equivalent to only one-eighteenth of Lotte Group.
More in Industry
Are you Taycan to me?
Facebook hit with $6 million penalty for customer data leak
Spinoff to give LG chairman's uncle his own conglomerate
Lotte companies make appointments earlier than usual
Doosan Heavy becomes largest shareholder of Doosan Fuel Cell