Addendum
Game set and match to KAL’s Walter Cho in leadership battle with siblings
April 1st 2020
The long and often bitter family battle for management control of Korean conglomerate, Hanjin Group, and its flagship company, Korean Air (KAL), is over, at least for the time being. Read More »
Incumbent Hanjin Group chairman and KAL president, Cho Won-tae, or Walter Cho, convincingly defeated his sister, Cho Hyun-ah, in a shareholder vote at the chaebol’s annual general meeting. The elder Cho, widely known as Heather Cho, had tried to remove her brother as chairman, assisted by the support of a coalition of critics of the conglomerate.
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Well known in Korea, she achieved orbital infamy after a “nut rage” incident in December 2014 when she forced a KAL jet, taxi-ing to take-off, to return to the gate because she was unhappy with the way she was served nuts in first class. She wanted to offload the offending flight attendant from the flight.
The incident, which eventually resulted in a five-month jail term for Cho, shone more intense media light on a simmering battle between the siblings for control of Hanjin Group as the health of their father, Cho Yang-ho, the long-time chief of the conglomerate, was failing. Cho senior died, aged 70, in a California hospital a year ago.
Walter took control of the Hanjin Group in the months after his father’s death, which infuriated Heather. In retaliation, she forged a third party alliance with sufficient other shareholders in an attempt to topple Walter and his management team from power.
At the AGM in the final week of last month, Walter secured the votes of 56% of shareholders. Around 43% opposed his reappointment. Despite the COVID-19 crisis, 3,619 shareholders participated in the regular shareholder meeting, with around 100 physically present at the gathering in the Hanjin Group headquarters in Seoul. Neither Walter nor his sister attended.
In a statement following his re-election, Walter expressed his “sincerest gratitude to all the shareholders of Hanjin KAL for helping us successfully complete the seventh annual general meeting of shareholders”.
“The meeting served as an opportunity to hear the voices of various shareholders and employees and will act as a stepping stone in the future development and growth of Hanjin Group. Hanjin Group will now start afresh, respecting the wishes of the people,” he said.
KAL faced grave challenges from COVID-19, he continued. “The whole world is suffering greatly due to the COVID-19 crisis. The airline industry, in particular, is facing an unprecedented crisis,” he said.
“More than 90% of Korean Air’s aircraft are grounded. All of us at Hanjin Group are devoting our efforts to overcoming the crisis. We will take the necessary self-help measures to improve our financial structure.
“In addition to the previously announced sale of idle assets, we will actively seek to raise funds by consulting the board of directors. As the crisis we are facing cannot be overcome by the efforts of a single company or industry, we earnestly ask for the strong support of the government.
“As a national flag carrier representing Korea, Korean Air will take the initiative to overcome the current crisis. I will take the lead and do everything I can. The COVID-19 crisis will soon pass and we will emerge even stronger.”
