SEOUL, KOREA - It seems the wave of corporate governance structure reform is now on the shore of Lotte Group after hitting that of Samsung Group. That's because Shin Dong-Joo, the vice chairman of Lotte Holdings (Japan) and the elder brother of Lotte Group chairman Shin Dong-bin, has been buying Lotte Confectionery shares for ten months. Lotte Confectionery is considered a "hub" for the whole group's governance as it holds majority shares of core assets including Lotte Shopping.

 

 

According to the Financial Supervisory Service on May 26, Mr. Shin of Lotte Holdings (Japan) recently purchased 560 shares of Lotte Confectionery. Although the total volume is about 1 billion won, which would not cause any stir in the market, the fact that he has made repeated purchases at similar amounts for the past ten months has attracted interest. As a results, his share has increased to 3.85 percent from 3.48 percent in July last year, narrowing the difference with his younger brother who owns a 5.34-percent stake in the confectionery unit.

 

Market watchers said it was a countermove by Shin the elder in response to the younger sibling's move in June last year to raise the stake from 4.88 percent to 5.34 percent. Currently the two sons of the group's founder Shin Kyuk-ho have inherited the business units in Japan and Korea, respectively. Even then, it is too early to say the group succession plan has been completed. That's because Lotte Holdings of Japan controlled by the older brother is holding a 19.1-percent stake in Hotel Lotte in Korea that in turn controls many other affiliates within the umbrella. Even Lotte Shopping is almost equally owned by the elder (13.45%) and younger sons (13.46%).