Employees of South Korea’s Hanjin Group and ally to current leadership chipped in to muster support for the chairman facing challenge from his sister and outside forces.

Employees launched voluntary campaign to buy treasury shares in Hanjin KAL Corp. to build ammunitions for Cho Won-tae versus possibly stretched battle with his elder sister Cho Hyun-ah backed by shareholders Korea Corporate Governance Improvement (KCGI) and Bando Engineering & Construction.

The writer argued that the new management could carry out sweeping layoffs and restructuring.

The labor union of Korean Air released a statement on Feb. 14 that the alliance was born out of nothing but Cho Hyun-ah’s greed and speculative forces that will kick the employees out on the street. The group’s three labor unions from Korean Air, Hanjin Transportation and Korea Airport Service also released a joint statement on Feb. 17 to express their support for Cho Won-tae. The group’s former executive council consisting of about 500 former executives also said last week that they fully trust and support the incumbent management.

While employees’ input would be a moral support for the sitting chair, more actual support came from his closet ally Delta Air Lines, which disclosed Monday to the Korean authority that it has purchased 591,704 shares in Hanjin KAL last week to boost its stakeholding to 11.0 percent from 10.00 percent. The addition, lacking voting power in shareholders’ meeting in March with the agenda including reappointment of Cho Won-tae as the legal head of Hanjin, can act as future ammunition for a possible lengthy power struggle with his sister. .

Hyun-ah, the eldest daughter of late Hanjin Group Chairman Cho Yang-ho, stepped down from Korean Air vice president after disgracing herself and the company for her “nut rage” scandal in 2014 when she threw a tantrum over the way her nuts were served and ordered the plane to return to the gate.

She formed an alliance with Hanjin KAL’s second largest shareholder KCGI and fourth largest shareholder Bando to dethrone her brother Cho Won-tae who took over the helm of the country’s transportation conglomerate following the sudden death of his father in April 2019. They are known to hold 36.65 percent stake in Hanjin KAL, closely trailing 38.25 percent stake owned by Cho Won-tae and his supporters.

By Pulse

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