Honorary Chairman Cho Yang-rae of Korea & Company’s Petition for Limited Guardianship Dismissed Again on Appeal

The petition for the commencement of limited guardianship against Cho Yang-rae, Honorary Chairman of Hankook & Company, which escalated into a management rights dispute within the Hankook Tire family, was also rejected in the appellate court.

Cho Yang-rae, Honorary Chairman of Hankook & Company. [Image source=Yonhap News]

According to the legal community on the 11th, the Family Division 1 of the Seoul Family Court (Chief Presiding Judge Cho Young-ho) dismissed the appeal filed by Cho Hee-kyung, Chairwoman of the Hankook Tire Nanum Foundation, against her father, Honorary Chairman Cho, regarding the petition for the commencement of limited guardianship.

Cho, the eldest daughter of Honorary Chairman Cho, filed a petition for the commencement of adult limited guardianship with the Seoul Family Court in June 2020 in protest of Honorary Chairman Cho selling all of his shares in Hankook Technology Group (now Hankook & Company) to his second son, Chairman Cho. She claimed that the sale was invalid because Honorary Chairman Cho was not mentally healthy at the time of the sale. Cho stated, “An objective judgment is needed to determine whether my father was capable of voluntary decision-making in a healthy state.” At that time, the sale of shares made Chairman Cho the largest shareholder by securing 42.9% of the group’s shares.

The first trial court dismissed Cho’s petition in April 2022, and she immediately appealed. During the appellate trial, a detailed psychiatric evaluation of Honorary Chairman Cho was conducted. In May of last year, the appellate court sent a psychiatric evaluation request to Seoul Boramae Hospital, which submitted the evaluation results of Honorary Chairman Cho to the court in November of last year.

Industry insiders predict that this result may effectively end the management rights dispute among Honorary Chairman Cho’s children. Currently, Chairman Cho holds 42.03% of the shares as the largest shareholder of Hankook & Company. Even when combining the shares of eldest son Cho Hyun-sik (18.93%), Chairwoman Cho and her husband (0.81% + 0.01%), and second daughter Cho Hee-won (10.61%), they do not surpass Chairman Cho’s holdings. Last December, three of the four Hankook Tire siblings excluding Chairman Cho?Advisor Cho, Chairwoman Cho, and Ms. Cho?formed an 'anti-Cho Hyun-beom alliance' and attempted a public tender offer in cooperation with MBK Partners but failed.

Hankook & Company Group stated regarding the dismissal decision, “Honorary Chairman Cho is healthy, so this is a natural outcome.”

Chairwoman Cho’s side is expected to soon announce their position on this matter.

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