Koo Bon-moo, the chairman of South Korea’s fourth-largest conglomerate who transformed a local producer of cheap appliance into a global tech and chemical powerhouse over two decades, has died. He was 73.
Koo died Sunday at 9.52am Seoul time as he did not seek extension of life after falling ill a year ago, according to LG Group in an emailed statement.
The patriarch is expected to be succeeded by his adopted son, Koo Kwang-mo, 40, who was nominated to the board of LG on Thursday pending the approval of shareholders on June 29. Chairman Koo underwent multiple brain surgeries in recent years, Yonhap News Agency reported earlier.
In the 23 years since Koo became chairman, total sales at LG Group increased more than five times to 160 trillion won (Dh588 billion) in 2017 from 30tn won in late 1994. The company’s overseas sales increased tenfold to 110tn won in the same period.
“Chairman Koo is the one who built the foundation of LG’s global businesses which span batteries to OLED panels and telecom,” said Park Ju-gun, president at corporate research firm CEOScore.
Under Koo’s 23-year leadership, the South Korean home-appliance maker, which produced its first radio in 1959, became one of the world’s top five phone brands and its LCD business is now neck and neck with Samsung Electronics. Koo entered the telecom business in the late 1990s and also moved into businesses such as car batteries and energy in search of new revenue.
LG Chem has grown into a leading car-battery maker, providing its products to such automakers as Ford and Renault. In 2015, LG Electronics struck a deal to co-develop General Motors’s Bolt electric vehicle.
Koo was the third generation of his family to run the conglomerate, known locally as the chaebol or “wealth clique,” after taking over the helm from his father in 1995. Koo adopted the holding company structure in 2003 and the group was later divided into four smaller parts, with Koo keeping the electronics, chemical and telecommunications businesses under his helm.
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Koo was the oldest grandson of LG Group’s co-founder Koo In-hwoi, who set up Lak Hui Chemical Industrial and started making cosmetics before expanding into plastics and household products such as toothpaste.
He is survived by his wife, son Kwang-mo and two daughters. The son was adopted in 2004 from the older Koo’s younger brother Koo Bon-neung, chairman of Heesung Group.
“There seems almost no risk in LG’s succession plan as the group appointed a successor early and the Koo family has the largest stake in the holding company,” said Park. “LG’s heir is likely to take the role of a board chairman and let professional management executives lead the businesses.”
As of March 31, Koo family members and LG’s two charity foundations held 46.7 per cent of shares in LG Corp., the holding company of LG Group.
The younger Koo joined the group’s LG Electronics unit in 2006 and is currently a vice president at the information displays operations. He’s been involved in multiple businesses such as appliances, home entertainment, and group strategy, according to LG.
LG ranks as the fourth-largest among the nation’s family-run conglomerates with 123tn won of assets across 70 affiliates. Many of the nation’s chaebol, including Samsung Group, are undergoing a once-in-a-generation transition of power as their leaders age. But those succession plans haven’t always gone smoothly as they face increasing opposition from activist investors such as billionaire Paul Singer’s Elliott Management.
“The funeral will be quiet and simple, like he and his family had wanted, and we’ve decided that it will not be public,” LG said in its statement.
