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[SUPER RICH] Lotte founder no stranger to fraternal feud
By Korea HeraldPublished : Aug. 4, 2015 - 18:02
Lotte founder and general chairman Shin Kyuk-ho became both the protagonist and antagonist of a soap opera-ish family feud since July 27 when he tried to oust his second son from his business empire but instead was kicked out himself and became powerless.
The family secrets and anecdotes revealed by his eldest son Shin Dong-joo in media interviews last week portray the 93-year-old as the “king” of the Lotte empire -- someone who can still slap his 60-year-old son, fire any top executive with the flick of his finger and order everyone to report the smallest detail to him.
Indeed, Shin with his control-freakish nature is no stranger to a fraternal feud. He has been involved in many such spats with his siblings for a long time.
“Kyuk-ho is hardly on speaking terms with his siblings,” a source told The Korea Herald.
“When the senior Shin -- the eldest of five sons and five daughters of a modest farmer rooted in Ulsan -- established Lotte with seed money of 1.5 million won, he shared his power with his brothers initially.
But as time grew, he understood the importance of becoming a ruler with total control, which resulted in some frictions. “His ruthless character may have fueled some unnecessary conflicts,” he added.
Perhaps, the most well-known case is his nearly 40-year-long spat with Nongshim chairman and younger brother Shin Choon-ho.
The two disavowed each other after Kyuk-ho ordered Choon-ho to stop using the Lotte brand name for his own business selling instant noodles, which was at that time called Lotte Industrial.
In 1978, Choon-ho changed the name to Nongshim and started producing globally-bestselling Shin Ramen and others.
But Choon-ho cut himself off from his brother and did not attend their father’s remembrance ceremony or other events. “For Choon-ho, the succession drama between Kyuk-ho’s two sons does not mean a thing,” an onlooker said.
Shin Joon-ho, the youngest of the brothers, first started out as Kyuk-ho’s right hand man, having served as the CEO of Lotte Ham, Lotte Milk and others. But in 1996, the brothers were engaged in a legal battle over the ownership of a prestigious piece of real estate in Yangpyeong-dong, Seoul.
In 2004, Joon-ho went solo by acquiring Daesun Brewery. In 2007, he was given the managerial rights of Lotte Milk, but he changed the name to Purmil after Kyuk-ho ordered the company to cease using the Lotte brand name.
Their youngest sister, Shin Jung-hee had a tiff with Kyuk-ho when he filed an injunction against Lotte Tour, the travel agency she ran with her husband Kim Ki-young, once again for using the brand name. Lotte Group took the legal step in order to enter the travel business by launching a joint venture with Japanese travel agency JTB.
Jung-hee also rubbed Kyuk-ho the wrong way when she sold 19.9 percent of Dongwha Duty Free store that she runs to Shilla Duty Free Store, Lotte Duty Free Store’s archrival.
“But Jung-hee attends their father’s remembrance ceremonies and other family meetings. So she may be better than her brothers (in relations with Kyuk-ho),” an insider was quoted as saying.
Even Sun-ho has had bad moments with Kyuk-ho, especially when his son-in-law Lee Ho-jin, chairman of Taekwang Group, opposed Lotte’s acquisition of Woori Home Shopping. Taekwang was the second largest shareholders of the TV shopping channel but Lotte ignored the request and bought the company, renaming it as Lotte Home Shopping.
However, unlike other brothers, Sun-ho has good relations with his eldest brother and is actively involved in the latest family spat.
“The recent family tantrum will be a very difficult situation for the group founder because he has always been used to having everyone obey him. But at the same time he knows what it is like to lose a family and how deep the pain will be,” a business pundit said.
By Bae Ji-sook (baejisook@heraldcorp.com)
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Articles by Korea Herald
