Chaebol bosses’ stock wealth rising

Leading chaebol bosses are combining to make more in the stock market than the gross domestic product (GDP) of Bahrain, according to figures from a local think tank.

The report by the Korea CXO Institute shows that the combined value of stocks held by the corporate owners of the country’s top 30 business groups reached 30.2 trillion won (about $26.6 billion) at the end of June, representing a 2.1 percent increase from the start of the year. The economy of Bahrain, which sits 91st on the international wealth table, generated $26.1 billion last year.

Predictably, Samsung Electronics Chairman Lee Kun-hee cemented his status as the richest corporate figure, with the value of his stocks reaching 10 trillion won in June, increasing by 1.1 trillion won, or 12.7 percent, during the first six months of the year.

With 2.94 percent ownership, Lee is the biggest individual shareholder of Samsung Electronics, the undisputed kingpin of Korea Inc. and the world’s largest maker of flat-screen televisions, mobile phones and computer memory chips.

Chung Mong-koo, head of the Hyundai-Kia Automotive Group, which is growing as a global power, came in second with 6.7 trillion won in shares after a near 164 billion won increase in value during the first six months of the year. The group’s key affiliates, including Hyundai Motor and parts maker Hyundai Glovis, have been enjoying a better-than-expected 2012.

Chung Mong-gyu, chairman of Hyundai Development, saw the value of his stock holdings rise nearly 43 percent, or 74.5 billion won, during the first half of the year, with the company’s share prices soaring by more than 40 percent.

Not all corporate leaders made a killing. SK Group Chairman Chey Tae-won is 2 trillion won poorer in stocks than he was at the start of the year, to cap perhaps his worse time as a business executive. He was indicted in January on charges of embezzling 100 billion won in corporate funds, which prosecutors suspect were used to cover massive losses from ill-advised futures investments.

The value of the shares held by Hanwha Group Chairman Kim Seung-yeon plunged 83.3 billion won, or 14.8 percent. Similarities between Kim and Chey don’t end there as he was also indicted by prosecutors earlier this year for embezzling hundreds of billions of won from corporate coffers.

LG Group Chairman Koo Bon-moo held 1 trillion won worth of stocks at the end of June, down 11 percent from the end of December. The value of stocks held by GS Group Chairman Huh Chang-soo amounted to 697.4 billion won, a 13 percent fall from the start of the year.

Experts say that the data show an overview of the Korean economy. “Chaebol bosses who own export-driven companies remained stable amid economic turbulence, while domestic market-focused firms suffered losses,” said O Il-sun, head of the Korea CXO Institute. <The Korea Times/Kim Jae-won>

news@theasian.asia