Kumho group chairman's daughter under close watch by investors

Lim Chang-won Reporter() | Posted : July 5, 2018, 17:52 | Updated : July 5, 2018, 17:52

Kumho Asiana chairman Park Sam-koo lowers his head to apologize for an in-flight meal shortage. [Yonhap Photo]

SEOUL -- The daughter of Park Sam- koo, the 73-year-old business tycoon who controls South Korea's mid-tier conglomerate, Kumho Asiana, has become the subject of neighborhood gossip soon after she became a group executive this week.

Siblings of chaebol owners usually get quick promotions, but the sudden appointment of the chairman's daughter, Park Se-jin, as vice president at Kumho Resort in a reshuffle of group executives on July 1 surprised many market watchers. Kumho Resort manages golf and resort facilities.

Her debut was not opportune as it coincided with an unexpected shortage of in-flight meals that caused delays in the international flights of Asiana Airlines, the country's second-largest flag carrier controlled by Kumho.

Park Se-jin, the daughter of Kumho Asiana chairman Park Sam-koo. [Courtesy of Kumho Aisana]

Compared to Park Se-chang, the chairman's 44-year-old only son, Park Se-jin, 40, has been relatively unknown because she was a full-time homemaker with no experience in company management due to a family tradition of ruling out women from group affairs.

As the group's heir-apparent, Park Se-chang started taking his business administration training when he joined the group in 2002 as deputy head of Asiana's financial team. After building up his career at Kumho Tire, the country's second-largest tiremaker, he was promoted to lead the group's strategic management unit in 2016.

After graduating from Ewha Womans University in Seoul, Park Se-jin studied in Japan to build up her expertise in cooking. She earned cooking certificates from Le Cordon Bleu, a network of culinary and hospitality schools, and received her master's degree in global social studies from the graduate school of Japan's Sangji University.

The chairman gave no full explanation why he defied the family tradition established by his father who founded the group, saying only that it's time to let his daughter learn about her social life and business. "She has been out for a long time and now I think she needs to resume her social life."

"I thought she could do a small contribution to the development of Kumho Resort," the chairman said at a news conference on Wednesday, promising to train his daughter as a competent manager.

"I know there are a lot of concerns about my daughter," Park said, admitting he was well aware of concerns caused by the sudden appearance of her daughter. "If my daughter is criticized for her lack of ability or fails to get recognition, I will never tolerate."

Park Se-chang, the son of Kumho Asiana chairman Park Sam-koo. [Courtesy of Kumho Aisana]

The appointment of Park Se-jin's surprise debut came at the height of public sentiment against arrogant attitudes by the offsprings of conglomerate owners, fueled by illegal activities by the family of Hanjin Group owner Cho Yang-ho who controls Korean Air.

After surviving the 1997 Asian financial crisis, Kumho with subsidiaries in the fields of leisure, logistic, chemical and aviation acquired several big companies in the 2000s such as Daewoo Engineering and Construction, a debt-stricken builder, leading to a credit shortage.

With financial woes aggravated by the financial crisis of 2007-2008, the group put its key subsidiary Kumho Tire under a debt workout program in December 2009. Since then, Park Sam-koo has stepped up efforts to rebuild the group and accelerate the third-generation transfer of group leadership to his son.

However, Kumho's credibility fell after it failed to stop the sale of Kumho Tire to China's Doublestar this year, and the embattled group has another perfect storm as the shortage of meals damaged the image of Asiana credited with globalizing Korean food with in-flight Korean dishes.

In 2015, Skytrax, a commercial airlines research institute, recognized Asiana as the world's best for its differentiated economy class services such as comfortable seats and various in-flight entertainment and in-flight meals. A year later, however, Asiana launched a painful campaign to reduce costs through the sale of non-core assets.

"I do not have an excuse. If our forecast was good, this would not have happened. It's all my fault," the chairman said.

A service voucher handed out by Asiana Airlines in compensation for Asiana's meal shortage. [Yonhap Photo]

The shortage of meals began after Asiana changed its food catering service company. International flights have been delayed because meals were not delivered on time and dozens of short-haul flights have left without food. The CEO of a catering subcontractor committed suicide Monday due to extreme stress.

Asiana dumped a contract with a subsidiary of German airline Lufthansa to establish a new joint venture with China's HNA Group, but a fire gutted the factory of the new catering company in March. Asiana forged a temporary deal with a domestic company which is relatively small.

Park refuted the argument that the change came after HNA agreed to purchase 160 billion won ($143 million) in bonds with warrants issued by Kumho Holdings. "I changed the company to find a better partner," he said, adding Asiana and HNA established a strategic partnership through capital attraction regardless of their contract on meals.
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