Kumho Resort Accelerates Transformation into a Profit-Generating Model

[Asia Economy Reporter Hwang Yoon-joo] Kumho Petrochemical announced that it has initiated efforts to transform Kumho Resort into a future profit-generating model following its acquisition.

Kumho Petrochemical has recruited and deployed internal and external experts to assess the current status of Kumho Resort and expedite its normalization. For the resort business, they appointed Kim Jin-hyuk, former Executive Director of Hotel Shilla with about 20 years of comprehensive management experience at Hotel Shilla. For the golf business, they brought in Jeon Yoo-taek, former CEO of Hansol Development, who successfully turned around Hansol Oak Valley (now HDC Group Oak Valley Resort) under the Hansol Group. Additionally, Kim Sung-il, former Executive Director of Kumho Mitsui Chemicals and an expert in domestic and international sales and management, was selected as CEO of Kumho Resort. Internally, financial expert Jo Hyung-seok was appointed as CFO to contribute to improving the financial structure.

Based on appraisals by external evaluation agencies and recent similar transactions, the real estate asset value of Kumho Resort is estimated at approximately 790 billion KRW. Even after deducting about 370 billion KRW in liabilities, this value exceeds the acquisition price. Considering the financial capacity of the acquiring entities, Kumho Petrochemical and Kumho P&B Chemicals, the impact on the current financial status is assessed to be minimal. Reports from the three major domestic credit rating agencies also forecast that the 'positive' credit rating will be sufficiently maintained post-acquisition.

Kumho Resort holds about 82,000 pyeong of idle land at Asiana Country Club and about 35,000 pyeong at Asan Spavis, allowing for various uses that can create added value, such as attracting external investments. In particular, through remodeling the condominium sector to upgrade outdated facilities and forming strategic partnerships with online platforms, it is expected to quickly transition into a new business model capable of generating substantial profits.

Meanwhile, the acquisition of Kumho Resort is expected to further elevate the status of the Kumho Petrochemical Group. Among the 64 large business groups designated by the Fair Trade Commission, Kumho Petrochemical ranked 59th in 2020 with assets of 5.7 trillion KRW. After the acquisition, its asset size will reach 6.6 trillion KRW, moving up six ranks to 53rd based on the previous year’s data. More than half of the 64 large business groups operate golf courses and resort businesses, utilizing them for employee welfare, business, and improving internal and external corporate image. In this context, the resort acquisition is viewed very positively both internally and externally.

The acquisition process for Kumho Resort will be completed once the Fair Trade Commission’s corporate merger review, scheduled for the end of March, is approved, after which full-scale normalization efforts will commence.

This content was produced with the assistance of AI translation services.