South Korea's LG says will separate affiliates into new conglomerate

LX Hausys

26/11/2020 08:08

By Joyce Lee
    SEOUL, Nov 26 (Reuters) - South Korea's LG Corp  003550.KS 
said on Thursday its board had decided to restructure its
conglomerate LG Group by separating some of its affiliates such
as display chip maker Silicon Works Co Ltd  108320.KQ  to form a
new conglomerate next year.
    It is the latest in a series of deals and restructuring of
South Korea's family-led conglomerates as they grow in size and
go through generational succession. The reorganisation should
also help address regulatory pressure to limit intra-group
transactions at family-owned conglomerates.
    Koo Bon-joon will be chief executive of the new holding
company, according to LG Corp's regulatory filing. He will take
the reins of those affiliates from his nephew Koo Kwang-mo, who
took over as LG Group chairman in 2018 after his father passed
away.  
    LG Group is South Korea's fourth-largest conglomerate and
its core businesses include consumer electronics, chemicals, 
household products and cosmetics, as well as parts such as
batteries and displays used in GM  GM.N , Tesla  TSLA.O  and
Apple  AAPL.O  products.
    Affiliates that will be separated in May 2021 also include
trading company LG International Corp  001120.KS , LG Hausys Ltd
 108670.KS , maker of interior parts for housing and
automobiles, and unlisted chemical manufacturer LG MMA Corp, the
regulatory filing said. 
    The reorganisation also includes a spin-off of unlisted
Pantos Logistics Co Ltd. The logistics arm generated 64% of its
2019 revenue from other affiliates of LG Group including LG
Electronics  066570.KS  and LG Chem  051910.KS , according to
its regulatory filing. 

 (Reporting by Joyce Lee; Editing by Ana Nicolaci da Costa)
 ((jungyoon.lee@tr.com; +82 2 6936 1467;))