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- Coupang Adopts Amazon's 'Flywheel' DNA—Bom Kim's 'Bold Moves' Push Baemin and TVING to Join Forces
- Bom Kim, chairman of the board of Coupang Inc. (Coupang's parent company), is rapidly unveiling new strategies at lightning speed.
These are efforts to expand influence in the food delivery and online video streaming service (OTT) markets, and Kim's approach is marked by unprecedented benefits that are unimaginable in other industries.
Due to Kim's "boundary-pushing" ideas, only Baemin (Baedal Minjok) and TVING are bearing the brunt.
On May 12, industry insiders commented that the “flywheel strategy” Bom Kim has been pursuing is accelerating at an increasing pace.
The flywheel strategy, originally proposed by Amazon founder Jeff Bezos, refers to the effect where once business expansion gains momentum, it continues to grow on its own inertia.
The concept stems from the principle that while it takes great force to get a large wheel moving initially, it becomes easier and faster to spin with less effort once it starts rotating.
Coupang's virtual declaration of making Coupang Play free illustrates well the characteristics of Kim’s flywheel strategy.
Recently, Coupang announced that starting in June, even non-members of its paid Wow Membership will be able to access Coupang Play through a new "free general membership" model if they watch advertisements.
This “watch ads and watch for free” strategy is the opposite of Netflix and TVING’s “watch ads and get a cheaper rate” model. In fact, Netflix unexpectedly raised its monthly fee for its ad-supported plan from KRW 5,500 to KRW 7,000 (about USD 5.0).
To access Coupang Play, one needs to subscribe to the Wow Membership, which costs KRW 7,890 (about USD 5.7) per month, but Coupang has torn down this paywall itself—something competitors never imagined possible.
Considering that Coupang Play still does not generate profit, Kim's move is being evaluated as a “challenge to conventional thinking.”
Kim's unconventional moves have already been seen several times in Coupang Eats. In April 2023, Coupang Eats offered unlimited discounts of 5–10% on order amounts for Wow Membership users. For example, ordering KRW 20,000 (about USD 14.4) worth of food would get you up to KRW 2,000 (about USD 1.4) off, all subsidized by Coupang.
That Baemin and Yogiyo quickly followed suit with 10% unlimited discount promotions shows how aggressive Coupang Eats' offer was.
In 2024, Coupang Eats raised the stakes again by introducing "free delivery." Since its main business, Rocket Delivery, began generating substantial profits, this move is seen as a strategy to invest those gains into Coupang Eats to expand its market influence.
Coupang Eats, long burdened by the label of being third in the market, surpassed Yogiyo to become the second-largest delivery service around this time. After losing its market share lead, Yogiyo suffered financially and offered its first round of voluntary resignations in August last year.
Baemin also lost its grip on its 60% market share held since September 2022. Coupang Eats, having taken down Yogiyo, is now inching into Baemin’s territory.
Kim Bom-seok’s bold bets are leaving competing platforms in survival mode.
One industry insider said, “We knew Coupang would eventually break through in either delivery or OTT, but didn’t expect it to happen so fast. Since Coupang now generates huge profits from its core business, it has the firepower to invest widely. For those of us focused on one field, the damage is substantial.”
Within the delivery industry, there’s a growing complaint of “Why are we the first target?”
A source from the delivery app industry said, “We assumed Coupang would lead with Coupang Play in the OTT space before tackling the delivery sector, but its aggressive entry into delivery has heightened the sense of crisis. If we can’t shift the current flow, tough times will continue.”
CJ ENM's TVING is facing a similar crisis. TVING, which has been competing with Coupang Play for the No.2 OTT position behind Netflix, held the No.2 spot until February. However, starting in March, Coupang Play pulled ahead by about 430,000 monthly active users.
Coupang Play began exclusively releasing popular drama series from HBO, a premium overseas broadcast channel, in March. With English Premier League (EPL) coverage starting in August, its momentum is expected to increase even more.
CJ ENM claimed in its Q1 earnings release that ad-tier subscribers now account for nearly 40% of TVING’s users, a positive sign. However, many doubt whether this will be enough to stop the user shift toward Coupang Play.
TVING also suffered a subscriber loss after ending its partnership with Naver in Q1. This serves as a case showing how ending collaboration with other platforms can hurt user retention, and regaining footing with in-house content alone may not suffice.
TVING and Baemin appear to be exploring new joint service models as a stopgap measure. They are considering offering TVING content at no extra charge to subscribers of Baemin’s paid “Baemin Club” membership to boost monthly active users.
#Coupang #BomKim #CoupangPlay #CoupangEats #TVING #Baemin #Yogiyo #OTTstrategy #deliverymarket #ecommerceKorea
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- Amorepacific’s Next Leader: Eldest or Second Daughter — Where Does Suh Kyung-bae’s Trust Lie?
- On May 21, 2021, a “Report on Large-Scale Stock Holdings” of Amorepacific Group (currently Amorepacific Holdings) was posted on the electronic disclosure system (DART).
The report stated that Hong Jung-hwan, then Head of Investment Review at Bokwang Industrial Investment (currently CEO of Polestar Partners), would donate 100,000 shares of Amorepacific Group stock to Suh Kyung-bae, Chairman of Amorepacific Group.
At the time, Hong was the husband of Suh Kyung-bae’s eldest daughter, Suh Min-jung. The shares that Hong donated to Chairman Suh were the same shares Suh had given to Hong when he became his son-in-law.
This donation disclosure served as a message signaling that the much-publicized marriage between Suh Min-jung and Hong had ended in divorce, and it also marked the beginning of uncertainty regarding the succession structure of Amorepacific Group.
◆ Suh Min-jung, once a strong successor candidate, now facing a shift in momentum
Suh Min-jung had long been considered a strong successor to Amorepacific Group.
She joined Amorepacific in 2017, undergoing management training and taking the steps of a "successor-in-training." After graduating from Cornell University in the United States, she gained practical experience and gradually built her presence within the group.
However, two years after the news of her divorce surfaced in 2021, Suh Min-jung submitted a leave of absence from Amorepacific in 2023. In some business circles, there were rumors that Suh had planned to remarry, which reportedly infuriated Chairman Suh Kyung-bae.
In the same year, Chairman Suh donated 672,000 common shares (0.97%) and 1,728,000 preferred shares (12.77%) of Amorepacific Group (now Amorepacific Holdings) to his second daughter, Suh Ho-jung.
This led to speculation in the business community that Suh Min-jung had fallen out of favor with her father due to her divorce and rumors of remarriage, and that Chairman Suh might be intending to hand over the group to Suh Ho-jung instead.
In particular, analysts suggest that the 12.77% of preferred shares held by Suh Ho-jung could be a decisive factor in shaping the future ownership structure.
Currently, Suh Min-jung holds 2.93% of Amorepacific Holdings’ common shares and 1.04% of its preferred shares. While her common shareholding is higher than Suh Ho-jung’s (0.97%), many observers believe she can no longer be clearly considered the “first in line” for succession. This is largely due to the significant influence of the 12.77% in preferred shares held by Suh Ho-jung.
◆ Suh Ho-jung quietly increasing her presence — a sign of change in the ownership structure?
Second daughter Suh Ho-jung holds 12.77% of Amorepacific Holdings’ preferred shares.
These preferred shares are not ordinary preferred shares; they are convertible into common shares ten years after the issuance date. While her common shareholding is currently minimal, the 12.77% in preferred shares is too significant to be overlooked.
In fact, in its report on large-scale stock holdings, Amorepacific Holdings explicitly states that these shares are “preferred shares that will be converted into voting shares.”
This means that the preferred shares held by Suh Ho-jung could, in the long run, become the basis for her to significantly expand her common shareholding and secure control over the holding company.
In the past, Amorepacific’s preferred shares have been viewed as a means to reduce inheritance taxes. Since they currently carry no voting rights, they are less valuable, making them less burdensome in terms of gift tax. However, once they are converted into common shares ten years after issuance, their influence over corporate control greatly increases.
The fact that Chairman Suh Kyung-bae gifted such preferred shares to his second daughter Suh Ho-jung is a strong signal that his favor may have shifted toward her.
◆ Succession structure still uncertain, the key variable is ‘Suh Kyung-bae’s intention’
Born in 1963, Chairman Suh Kyung-bae is not yet at an age where retirement is imminent. However, he is in a position where he must begin to establish a long-term succession plan, as corporate succession is not something that happens overnight.
Suh Min-jung, once a strong successor candidate, has since faded from prominence, while Suh Ho-jung is still considered a relatively untested “rookie.”
Based solely on the current shareholding structure, it appears the scale is tipping toward Suh Ho-jung.
However, considering the traditional mindset of Korean conglomerates, the symbolic weight and expectations associated with the “eldest daughter” could still act as a variable in the succession structure.
It is also known that Chairman Suh once had great trust in Suh Min-jung.
A business insider remarked, “Back in 2020, Chairman Suh carried out a generational shift in the executive team, injecting a wave of younger talent into the group, and there was talk at the time that this was a strategic move to prepare the group for Suh Min-jung’s succession.”
Given that neither daughter has yet demonstrated tangible management achievements, and considering the difficult market conditions faced by Amorepacific, it is unlikely that succession will proceed based solely on bloodlines and equity holdings.
Amorepacific is grappling with risks such as a downturn in the Chinese market and intensifying competition in Korea’s beauty industry. The successor will need the capability and leadership to overcome these challenges.
A business source noted, “The 12.77% in preferred shares held by Suh Ho-jung could be a crucial factor in determining Amorepacific’s future ownership structure,” adding, “However, since both daughters are still very young, their future performance and ability to gain market trust will ultimately shape the final succession plan.”
#Amorepacific #SuhKyungbae #SuhMinjung #SuhHojung #KoreanChaebolSuccession #PreferredShares #FamilyOwnership #BeautyIndustryKorea #CorporateGovernance #InheritancePlanning
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- Chung Eui-sun Tackles Tariff Crisis with Hyundai’s Quality Management DNA
- Chung Eui-sun, Chairman of Hyundai Motor Group, is confronting the tariff crisis head-on with quality management.
This comes as Hyundai appointed Executive Vice President Philippe Guerin-Boutaud, recognized as an expert in the fields of quality and safety, as its first head of the Global Product Operations Division. This move is seen as a strategic signal to compete with quality rather than price in the U.S. market, where the impact of auto tariffs will begin in earnest starting in June.
On the 8th, within the automotive industry, Hyundai’s recent organizational restructuring was interpreted as a strategy to enhance its quality competitiveness and achieve strong results in the U.S. despite the auto tariffs.
Quality management has been embedded as part of Hyundai’s “DNA” since Honorary Chairman Chung Mong-koo became chairman of the company in 1999.
It is ironic that Honorary Chairman Chung came to emphasize quality management due to a quality controversy in the U.S. market. In 1998, Hyundai experienced a quality issue in the U.S., causing sales to plummet to historic lows.
In 1999, Chung implemented a 10-year/100,000-mile free repair warranty in the U.S. Compared to Ford and General Motors (GM), which offered 3-year/36,000-mile warranties, and Toyota, which offered 5-year/60,000-mile warranties, Hyundai's policy was considered groundbreaking.
He told employees, “Isn’t it enough to make and sell cars that won’t break down for 10 years?”
Quality management, which Honorary Chairman Chung prioritized until stepping away from the frontline, is now regarded as fully established under Chairman Chung Eui-sun’s leadership.
Last year, Hyundai Motor Group ranked first among 15 global automobile groups in the Initial Quality Study (IQS) conducted by U.S. market research firm J.D. Power.
The IQS conducted by J.D. Power, launched in 1987, is considered the most prestigious automobile quality survey in the world. It evaluates the quality of new vehicles based on customer experiences within the first three months after purchase.
Despite already being evaluated as possessing top-tier quality in the global market, Chairman Chung is expected to invest even more effort into raising quality.
Hyundai is implementing a price freeze policy in the U.S. by utilizing pre-produced inventory. Hyundai CEO Jose Muñoz has announced that prices will not be raised until June 2.
However, since auto tariffs are expected to have a full impact starting in June when inventory is exhausted, it is anticipated that securing price competitiveness will be difficult.
If a situation arises where automakers across the U.S. raise prices overall, quality is likely to become even more important.
Some analysts believe Hyundai gained confidence that a focus on quality competitiveness could resonate with consumers, as the company showed strong sales in the U.S. in April, when auto tariffs began to be imposed.
In April, Hyundai sold 81,503 vehicles in the U.S. This represents a 19% increase compared to the same period last year. It is Hyundai’s highest-ever performance for April and marks the seventh consecutive month of setting a new monthly sales record.
Compared to competitors like Ford and Stellantis, which lowered prices to sell vehicles after the tariff imposition, Hyundai maintained its price freeze yet saw a significant increase in sales. This is also seen as evidence that price competitiveness alone is no longer the answer.
To focus on quality competitiveness, Chairman Chung appointed Executive Vice President Philippe Guerin-Boutaud as head of the Global Product Operations Division.
The Global Product Operations Division is responsible for planning the products Hyundai develops, produces, and sells worldwide. It also oversees the designation of production locations by country and the review of regulations necessary for local sales after vehicle development.
Previously, this was part of the Global Business Management Division under the name Global Product Support Office, but in the latest restructuring, it was elevated to the status of a full division. Its name was changed to the Product Operations Division, and the head's rank was raised from Executive Director to Executive Vice President.
Philippe Guerin-Boutaud worked at Renault Group for 33 years before being recruited by Hyundai in 2023. From 2010 to 2012, he also worked at Renault Samsung Motors.
He is considered an expert in quality and safety. Just before joining Hyundai, he was responsible for quality and customer satisfaction at Renault Group, where customer satisfaction increased by 17% over one year. The number of accidents dropped by 40% in just over a year, marking the lowest level in the brand's history.
It is known that Executive Vice President Philippe Guerin-Boutaud played a significant role in Renault Group’s improvement in customer satisfaction and reduction in accidents.
Regarding this appointment, CEO Jose Muñoz stated, “The global expertise of Executive Vice President Philippe Guerin-Boutaud will help create greater value across the entire product portfolio.”
#Hyundai #ChungEuisun #PhilippeGuerinBoutaud #qualitymanagement #autotariffs #HyundaiMotorGroup #HyundaiUSA #JDPower #HyundaiSales #automotiveindustry
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- How Will Lee Dong-chae Pass Down Ecopro? Spotlight on Family Firm Daisy Partners
- With the succession process of former Ecopro Chairman Lee Dong-chae underway, attention is turning to a family-owned company called Daisy Partners.
This company is 100% owned by Lee Dong-chae, the founder of Ecopro Group, and his family. More than just a management consulting firm, it is taking on a core role in the group’s governance structure and is emerging as a strategic base for the succession process.
△Background and Basic Profile of Daisy Partners
Daisy Partners was established in 2001 as a small enterprise mainly providing management information, tax and accounting services, and outsourcing for HR and payroll operations.
It was initially founded under the name “Iroom TNC” but changed its name to “Daisy Partners” in July 2023.
Despite being a small-capital company with KRW 700 million (US$ 487,000) in capital, its total assets exceeded KRW 2.17 trillion (US$ 1.51 billion) as of the 2023 fiscal year.
Daisy Partners has shown almost no revenue-generating activities in its official business areas. However, even without revenue, it has posted non-operating income in the hundreds of billions of won each year, setting it apart from conventional management consulting firms.
Its revenue structure primarily comes from dividends, interest income, and disposal of investment assets within the group affiliates. According to external audit reports, its non-operating income was about KRW 293.3 billion (US$ 204 million) in 2023 and non-operating expenses were KRW 140.6 billion (US$ 97.8 million). In 2024, non-operating income stood at about KRW 108.7 billion (US$ 75.6 million) and non-operating expenses at KRW 76.6 billion (US$ 53.3 million).
Nevertheless, Daisy Partners has continued to report operating losses for several years due to its lack of sales revenue.
△100% Family-Owned: Daisy Partners’ Shareholding Structure and Status
The largest shareholders of Daisy Partners are former Chairman Lee Dong-chae, his wife Kim Ae-hee, and their two children: eldest son Lee Seung-hwan, Executive Vice President of Ecopro, and daughter Lee Yeon-soo, Managing Director at Ecopro.
In terms of equity distribution, Lee and his wife each hold 20%, and the two children each own 30%.
Notably, both children—Executive Vice President Lee Seung-hwan and Managing Director Lee Yeon-soo—are engaged in actual management roles at the Future Strategy Division and the venture investment firm Ecopro Partners, respectively, while concurrently undergoing management training, indicating the succession process is actively progressing.
Lee Seung-hwan was promoted to Executive Vice President in December 2024 and has already taken on a key position within the group, solidifying his status as a second-generation leader. He is gaining practical experience in corporate management while preparing for a natural generational shift.
Daisy Partners holds about 4.8% of Ecopro's shares. As of May 2024, it also holds 3.5% of Ecopro BM, 9% of Ecopro Partners, 0.6% of Ecopro Materials, and 18% of Haepalangwoori.
While Daisy Partners continues to post operating losses with almost no sales, its capital size is expanding rapidly.
Its operating loss for the 2024 fiscal year was around KRW 580 million (US$ 403,000), but net profit reached KRW 24.5 billion (US$ 17 million), which is believed to result from accounting valuation gains and investment asset disposal profits.
In early 2024, Daisy Partners executed a large-scale transaction by selling about KRW 268.5 billion (US$ 186.7 million) worth of Ecopro and Ecopro BM shares on the open market. The company explained that the purpose of the sale was to fulfill debt repayment agreements and to secure donations for the establishment of a public interest foundation.
△Succession Cases in Korean Conglomerates and the Role of Daisy Partners
Succession of management rights in Korean conglomerates (chaebol) generally occurs through three main methods.
The first is by legitimately paying inheritance or gift taxes and transferring management rights, with recent examples including Samsung, LG, and Hanjin.
The second involves using lower-tier affiliates to increase value through internal transactions, thereby creating a financial base for succession. Notable examples include Hyundai Glovis’ role in the succession of Hyundai Motor Group Chairman Chung Eui-sun, and Samsung SDS being funneled group IT projects when Lee Jae-yong and the founding family held shares.
The third method involves the heir securing shares of a core company at the top of the group’s governance structure (holding company or de facto holding company) through another company where the heir is the major shareholder—usually an unlisted company—and then merging the two. Examples include the merger of Cheil Industries and Samsung C&T in Samsung Group, and the merger of SK and SK C&C in SK Group.
Other methods include donating affiliate shares to public interest foundations controlled by the owner family (e.g., DL Group), or using financial tools such as convertible bonds (CB), bonds with warrants (BW), or restricted stock units (RSU), as seen in the Samsung Everland convertible bond case.
In the case of Daisy Partners within the Ecopro Group, the structure appears more complex and somewhat different from traditional succession methods.
Daisy Partners, being a family-owned company with shares evenly held by Lee, his spouse, and children, stands at the center of major decision-making, stock ownership, and equity management within the group.
However, since the company does not generate operating profits as a business entity, it seems unlikely to serve as a direct financial source for succession.
△Role Within Ecopro Group and Succession Scenario
One expected scenario for utilizing Daisy Partners in the succession process of the Ecopro Group is to merge it with the holding company, Ecopro.
Ecopro transitioned to a holding company structure in 2021, establishing a governance model centered around former Chairman Lee Dong-chae. The Ecopro Group has adopted a structure that flows from “former Chairman Lee Dong-chae → Ecopro (holding company) → 12 affiliates,” with Daisy Partners holding 4.8% of Ecopro and serving as a key intermediary in this structure.
Lee’s activities—such as indirect shareholding, stock purchases, and exercising stock subscription rights through Daisy Partners—are interpreted as part of a succession strategy aimed at reorganizing group control around the family.
Since 2010, Daisy Partners has acquired Ecopro’s bonds with warrants (BW), exercised those rights, and secured many new shares, continuously expanding its investment scale.
Considering that Lee is not directly transferring shares or gifting them to his children but instead expanding control via the family company Daisy Partners, it is likely that this company will be used as the vehicle for management succession.
Furthermore, it is noteworthy that both of Lee’s children, Lee Seung-hwan and Lee Yeon-soo, were included in a recent restricted stock unit (RSU) allocation to employees within the Ecopro Group.
Although the number of shares they received—131 for Executive Vice President Lee Seung-hwan and 91 for Managing Director Lee Yeon-soo—is still small, this is interpreted as a move to increase equity ownership among second-generation management and reinforce responsible leadership.
#LeeDongchae #Ecopro #DaisyPartners #succession #Koreanchaebol #familybusiness #shareholding #RSU #governancestructure #investmentstrategy
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- Coupang Targets KRW 1 Trillion in Operating Profit as Bom Kim Increases Focus on Taiwan
- Bom Kim, Chairman of the Board at Coupang Inc. (the parent company of Coupang), has been frequently mentioning "Taiwan" in recent statements.
Kim previously expanded Coupang’s market presence in South Korea through a so-called “planned deficit” strategy. Now, he is applying that same approach to Taiwan, and early signs of progress are beginning to appear.
If this strategy proves successful in Taiwan—similar to a “blue spot” in Go AI terminology—it could accelerate Coupang’s path toward achieving KRW 1 trillion (US$ 695 million) in operating profit.
Coupang’s Q1 results, released on May 7, highlight the sharp rise in revenue from its Developing Offerings segment.
This division includes Coupang Play (an online video streaming service), Coupang Eats (a food delivery platform), the Taiwan business, and Farfetch, a luxury e-commerce platform.
Compared to its main Product Commerce division—which includes Rocket Delivery and Rocket Fresh—Developing Offerings remains small. In 2023, its revenue accounted for just 3.3% of that of Product Commerce. With the acquisition of Farfetch in 2024, it has grown, but still only represents 13.4% of Product Commerce’s revenue.
Still, the Q1 results suggest that the growth of this segment can no longer be ignored.
In Q1, Coupang reported revenue of US$ 1.038 billion from Developing Offerings. At a fixed exchange rate of KRW 1,452.66 per dollar, this exceeds KRW 1.5 trillion—marking a 78% increase from Q1 2024.
Considering that Coupang’s total revenue grew 21% year-over-year in Korean won and Product Commerce rose by 16%, it’s clear that Developing Offerings made a major contribution to the company’s growth.
Gross profit figures also showed strength in this segment.
Developing Offerings generated US$ 165 million in gross profit, with an 87% increase in Korean won terms—over three times the 28% growth in the Product Commerce division.
Though Developing Offerings is not yet profitable, Coupang posted an adjusted EBITDA of minus US$ 168 million for this division in Q1.
However, this loss was down roughly 10% from Q1 last year, suggesting that economies of scale are beginning to take hold—growing revenue while narrowing losses.
Among all components of the Developing Offerings, Kim is particularly focused on the Taiwan business.
He personally joined the Q1 earnings conference call and spoke for approximately 2 minutes and 20 seconds about Developing Offerings—over 1 minute and 20 seconds of which was dedicated to Taiwan.
By contrast, he spoke for just 25 seconds on Farfetch and 18 seconds on Coupang Eats, indicating his strong interest in the Taiwan operation.
He also personally answered a question about Taiwan from a Morgan Stanley analyst, instead of deferring to CFO Gaurav Anand, speaking for approximately 2 minutes and 7 seconds.
“One of the most exciting opportunities in our Developing Offerings is Taiwan,” said Kim. “Like in Korea, where we created jaw-dropping experiences for consumers, we see massive potential to do the same in Taiwan.”
According to Kim, Coupang is forming direct supply relationships not only with global brands like Coca-Cola, Pepsi, P&G, and Unicharm, but also with key local brands important to Taiwanese consumers. Coupang noted that its Taiwan product lineup grew sixfold in Q1 compared to Q4 of last year.
Coupang has also introduced its paid “Wow Membership” program—key to its explosive growth in Korea—to the Taiwan market. This is expected to be another growth catalyst. The Taiwan Wow Membership program offers free Rocket Delivery and returns within 30 days for a monthly fee of KRW 2,600 (US$ 1.80).
“This program provides tremendous value and savings to members, and like in Korea, we expect it to increase spending per member,” said Kim. “We’re excited about our investment in Taiwan, and we believe our already strong growth figures can go much higher.”
If Coupang’s Taiwan business, led by Kim, continues to gain momentum, its operating profit is expected to grow sharply as well.
Coupang reported Q1 operating profit of KRW 233.7 billion (US$ 162.5 million) based on a fixed exchange rate. While this appears lower than the KRW 435.3 billion (US$ 302.8 million) posted in Q4 2024, the previous quarter’s result included a one-time KRW 244.1 billion (US$ 169.8 million) insurance payout related to a fire at the Deokpyeong logistics center. Excluding that, the Q1 figure represents the company’s highest quarterly operating profit to date.
Coupang’s operating profit trajectory has been steadily improving: from KRW 53.1 billion (US$ 36.9 million) in Q1 2024, it slipped into the red in Q2, then recovered to a profit of KRW 148.1 billion (US$ 103.1 million) in Q3, and has continued to grow for three consecutive quarters.
Given this trend, some in the e-commerce industry believe that Coupang may achieve KRW 1 trillion (US$ 695 million) in annual operating profit for the first time this year.
#Coupang #BomKim #Taiwan #CoupangTaiwan #DevelopingOfferings #WowMembership #Farfetch #EcommerceGrowth #RocketDelivery #OperatingProfit
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- DL Group’s Shadow Holding Structure: Lee Hae-wook Gains Power, Avoids Accountability
- DL Group transitioned to a holding company structure in 2021, but the so-called "shadow holding company" governance structure established in the process continues to weigh heavily on Chairman Lee Hae-wook.
Under this structure, DL Group is ultimately controlled by the unlisted company Daelim. While Chairman Lee’s control over the group has increased, questions around managerial accountability have become more prominent.
△ Shadow Holding Structure Raises Accountability Concerns
As of May 7, DL Group operates under a three-tiered structure: unlisted Daelim at the top, listed DL in the middle, and various subsidiaries at the bottom.
Chairman Lee Hae-wook holds a 52.3% stake in unlisted Daelim, effectively giving him control over the entire group. However, this layered structure creates a scenario where the group leader can exert decision-making power without clearly defined accountability.
This has led to social controversy, particularly in cases involving serious industrial accidents. In such incidents, it remains ambiguous who should be held responsible due to the complexity of the governance model.
According to the Serious Accidents Punishment Act, employers and responsible executives can face criminal charges when workplace safety and health obligations are violated, leading to incidents such as fatalities.
However, based on the Ministry of Employment and Labor’s 2023 compilation of legal interpretations, corporate executives at the headquarters are generally not held responsible under the law if a serious accident occurs at a subsidiary, which is a separate legal entity.
As a result, the owner-executive who controls the top-tier unlisted company can influence critical business matters such as construction deadlines, yet evade legal accountability.
For example, since the Serious Accidents Punishment Act came into effect, DL E&C has been identified as one of the domestic conglomerates with the highest number of serious industrial accidents, with seven incidents leading to the deaths of eight workers. Still, Chairman Lee Hae-wook has not been held legally responsible.
Due to these recurring incidents, both political and civil society groups have urged for clearer executive accountability, emphasizing the need for responsible management and calling on Chairman Lee and other key executives to be directly answerable.
At a December 2023 parliamentary hearing on industrial accidents, Chairman Lee expressed his commitment to safety, though he did not accept legal liability.
Lee stated, “With recurring accidents, DL Group, along with our partners, is reviewing our processes and considering how to enhance safety awareness every time an incident occurs. We will reexamine relevant systems, including the right to stop work, to prevent such incidents from happening again.”
A legal expert commented, “Clarifying the corporate leader’s policy direction and accountability in the event of a serious accident is crucial for worker safety. But the ‘shadow holding company’ structure, which many large Korean conglomerates maintain, poses significant obstacles to clearly identifying and monitoring executive responsibility.”
△ Unlisted Daelim Shields the Group from Oversight
DL Group’s governance is under even greater scrutiny because Daelim, which sits at the core of the structure, is an unlisted company that remains largely unknown to the public. Unlike listed firms, unlisted companies have fewer disclosure obligations, making it harder for stakeholders to access internal information.
As a result, oversight and checks by minority shareholders and other market stakeholders become more difficult, undermining transparency and accountability in corporate governance.
Critics argue that this structure strengthens control while enabling avoidance of responsibility—a system where the group’s leader draws the overall blueprint, but specific lines of authority and accountability remain vague. This undermines shareholder confidence and trust in the broader market.
Given that major Korean conglomerates such as Hyundai Motor Group, Samsung Group, and SK Group are actively pursuing governance reforms and enhanced corporate responsibility, DL Group is also under growing pressure to resolve issues stemming from its layered governance structure.
Improving corporate governance could become a critical turning point for DL Group to regain market trust and achieve sustainable growth, especially in the context of addressing its industrial accident issues.
All eyes are now on whether Chairman Lee Hae-wook can tackle the dual challenges of simplifying and increasing the transparency of DL Group’s complex governance structure, and taking genuine managerial responsibility to prevent future safety incidents.
#DLGroup #LeeHaewook #corporategovernance #industrialaccidents #SeriousAccidentsAct #Daelim #transparency #Koreanchaebol #shadowholding #accountability
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- Choi Sung-an Breaks Samsung Heavy’s Loss Streak, Outsider Advantage Pays Off
- How did Choi Sung-an, Vice Chairman and CEO of Samsung Heavy Industries, rescue the company from nine years of losses?
Now, attention is focused on whether Choi can further stabilize Samsung Heavy Industries’ high debt ratio and continue improving its performance.
◆ Choi Sung-an’s Management Strategy to Break the Long Chain of Losses
From the moment he took office, Choi Sung-an has pushed strongly for innovation and profitability under the vision of building a “technology-driven centennial enterprise.”
At the regular shareholders' meeting held in March 2025 at the Pangyo R\&D Center in Bundang-gu, Seongnam, he stated, “To move toward becoming a technology-driven centennial enterprise, we will accelerate manufacturing innovation to lead the high-value eco-friendly ship business and cutting-edge autonomous navigation technologies.”
As an expert in plant engineering, Choi has focused on expanding offshore plant and marine businesses, aiming to enhance competitiveness in high-value-added markets.
In particular, Samsung Heavy Industries achieved a remarkable feat in the FLNG (Floating Liquefied Natural Gas) sector, winning five out of nine global orders based on its unrivaled technical expertise.
Choi is emphasizing this push for competitiveness to maintain the rebound in performance that the company has recently achieved.
From 2015 to 2022, Samsung Heavy Industries recorded consecutive annual losses for eight years, accumulating more than KRW 5 trillion (US\$ 3.5 billion) in operating losses.
This was the result of several compounding factors: entering the offshore plant business without preparation, a sharp drop in international oil prices, a global shipbuilding downturn, low-price bidding competition, and the impact of the COVID-19 pandemic.
From 2019 to 2021, the company posted net losses of around KRW 1 trillion (US\$ 695 million) annually, which deepened its financial instability.
◆ Improving Financial Structure While Managing Risks
Samsung Heavy Industries’ financial structure remains challenging, adding pressure on Choi. As of the end of 2023, the company’s consolidated debt ratio was 357.4%, and this slightly increased to 358.6% by the end of 2024.
While the shipbuilding industry inherently follows a “heavy-tail” structure—where an increase in orders leads to more contract liabilities and borrowings—this level of debt is still considered high.
Moreover, in the fourth quarter of 2024, the company incurred a KRW 744 billion (US\$ 517 million) loss from derivative valuation following the termination of a contract with Russia’s Zvezda Shipbuilding Complex, resulting in a pre-tax loss of KRW 478.4 billion (US\$ 333 million) and a net loss of KRW 99.3 billion (US\$ 69 million).
Such accounting issues have again highlighted the importance of transparent risk management as they pose short-term financial risks.
Fortunately, credit rating agencies have assessed that these accounting losses are not serious enough to shake the company’s fundamentals.
Kim Jong-hoon, a senior researcher at Korea Investors Service, said, “Considering that Samsung Heavy Industries has posted an operating surplus in 2023 and that the proportion of low-margin orders has steadily decreased, its fundamental profit-generating capacity is on an improving trend. Therefore, the financial burden from the derivative loss is manageable.”
Choi has also actively pursued asset optimization and capital expansion, including the KRW 400 billion (US\$ 278 million) sale of the Pangyo R\&D Center.
Even after the sale, the company continues to use the facility under a leaseback arrangement, securing funds for future investments. This “sales and leaseback” strategy is viewed as a proactive response to a rapidly changing business environment.
Efforts to enhance financial stability are also reflected in the reduction of net borrowings.
Samsung Heavy Industries’ consolidated net debt decreased by 13.9%, from KRW 2.88 trillion (US\$ 2 billion) at the end of 2023 to KRW 2.48 trillion (US\$ 1.7 billion) by the end of 2024.
◆ Focusing on Advanced Technologies and the Green Market to Strengthen Future Competitiveness
Choi is not just focusing on profitability—he is also actively pursuing technological innovation and expansion into the eco-friendly ship market.
Samsung Heavy Industries is accelerating smart manufacturing innovation by combining digital transformation (DT)-based production automation with artificial intelligence transformation to build a next-generation shipyard capable of operating 24 hours a day.
The company is especially focused on developing carbon capture, liquefaction, and storage (OCCS) facilities and expanding eco-friendly propulsion systems, enabling it to respond swiftly to the International Maritime Organization’s tightened environmental regulations.
These efforts are a key strategy for securing differentiated competitiveness in the rapidly changing global shipbuilding market. Samsung Heavy Industries’ proactive approach to advancing technology in the eco-friendly ship sector is attracting attention.
The company is also reinforcing growth momentum by targeting high-profit ship types such as LNG carriers, FLNG units, and LNG bunkering vessels, as well as the offshore plant sector.
FLNG projects, in particular, are massive—each worth over KRW 2 trillion (US\$ 1.4 billion). Samsung Heavy Industries has secured a dominant position in this segment, building a strong presence in the global market.
Its leadership has been further strengthened by the constraints placed on its Chinese rival, Wison Shipyard, due to U.S. trade sanctions.
◆ The Future of Samsung Heavy Industries Depends on Choi Sung-an’s Leadership
Under Choi’s leadership, Samsung Heavy Industries has escaped the pit of deficits and achieved notable financial results in 2024. However, some believe that this is only the beginning of its recovery.
Challenges still remain, such as further improving the financial structure, managing risks related to exchange rates and contracts, and maintaining a technological edge over competitors.
Nonetheless, Choi is widely regarded as a “quiet yet strong leader,” both within and outside the company, and many expect him to overcome these hurdles with resilience.
It is also reported that Samsung Electronics Chairman Lee Jae-yong has deep trust in Choi.
Choi was promoted from president to vice chairman in 2022 and became CEO of Samsung Heavy Industries. He is the first vice chairman-level executive to lead the company since Kim Jing-wan stepped down in 2010—a sign of how much Lee values him.
At the time of his appointment, there were concerns in the shipbuilding industry because Choi was not from a traditional shipbuilding background.
Born in 1960, Choi graduated from Seoul National University with a degree in mechanical engineering. He joined Samsung Engineering’s petrochemical business division in 1989 and later served as head of the refining business unit, procurement head in 2012, and head of Plant Business Division 1 in 2017.
However, in a short time, Choi dispelled these concerns and led Samsung Heavy Industries out of its long tunnel of losses.
Now, time will tell whether his steadfast strategy focusing on high-value ships, advanced technologies, and green transformation will lead to lasting success.
#SamsungHeavyIndustries #ChoiSungan #ShipbuildingTurnaround #FLNG #GreenShipTechnology #SmartShipyard #SamsungGroup #OffshorePlant #CorporateDebt #LeeJaeyongTrust
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- What Changes Does Kim Taek-jin Hope Lawyer Park Byung-moo Will Bring to NCSoft?
- Seoul National University Law School, Harvard Law School, Kim & Chang law firm, and CEO of a private equity fund.
This is the career background of Park Byung-moo, CEO of NCSoft. At a glance, it is clear that he has lived a life entirely unrelated to gaming.
Park is a corporate restructuring expert. His career has focused on restructuring companies in crisis, improving their financials and operations, and preparing them for sale. With repeated successes in restructuring and sales, he earned the nickname “Midas’ hand” in the private equity industry.
Now, Park has become the captain of the game company NCSoft. So, what exactly does Kim Taek-jin, the founder and co-CEO of NCSoft, expect from him?
△Not a Sales Specialist, but a Revival Strategist — Kim Taek-jin’s True Intentions
Based solely on Park’s background, one might naturally wonder, “Is Kim Taek-jin planning to sell NCSoft?”
However, within the game industry, the possibility of Kim selling NCSoft is generally considered low. This is due to his strong attachment to both the company and its Lineage franchise. As one of the first-generation leaders of the Korean game industry, alongside the late Nexon founder Kim Jung-ju, it is hard to imagine Kim selling off NCSoft.
A closer look at Park’s actual work in corporate “makeovers” sheds light on what mission Kim may have entrusted him with.
Park is not the type of restructuring expert who simply prettifies a company’s financial statements for a sale. Instead, he has engaged in projects closer to “corporate rebuilding,” where he restructures companies suffering deep losses or declining valuations, revives their core assets, and restores their market competitiveness.
The clearest example of Park’s capabilities is the case of Hanaro Telecom.
After being appointed president of Hanaro Telecom, Park immediately launched an ambitious project called “Hana TV.” Hana TV became a pioneer in what is now the mainstream IPTV market, and was a decisive factor in SK Telecom’s decision to acquire Hanaro Telecom.
Eventually, Hanaro Telecom was reborn under SK Telecom as SK Broadband, now a key affiliate responsible for SK Group’s IPTV and wired internet businesses.
Park is also recognized for his sharp eye in discovering undervalued yet promising companies and bringing them back to life.
After becoming CEO of Vogo Fund (now VIG Partners) in 2010, Park led successful acquisitions and revivals of 17 companies, including Tongyang Life Insurance, BC Card, iRiver, Burger King, and Bodyfriend.
△Diagnosing NCSoft’s Crisis — Park Byung-moo Declares Structural Reform
In his first message following the 2024 shareholders’ meeting, Park stated, “The most important task is to restore trust as a game company,” and added, “We will regain strength based on the Lineage IP while pursuing strategic M&As to secure new content capabilities.”
NCSoft’s chronic risks include over-reliance on the so-called “Lineage-only” revenue structure, a lack of global influence compared to competitors, and uncertainty about the company’s future stemming from these factors.
Park believes that unless NCSoft fundamentally changes its corporate structure, its competitiveness will continue to decline. To break this cycle, he is proposing external content acquisition through M&A and a revamp of the company’s internal development capabilities.
At the 2025 shareholders’ meeting, Park said, “We are reorganizing our existing IPs while raising the evaluation standards for upcoming titles and rigorously monitoring the development process,” adding, “Many have worked tirelessly on M&A and investment, and this year, I hope we will see results that are clearly visible to everyone.”
△The Arrival of a Corporate Healer — Where Is NCSoft Headed?
Kim Taek-jin’s decision to appoint Park as co-CEO appears to stem from a desire to transform NCSoft into a more sustainable company.
Park’s past achievements largely focus on fixing and reviving malfunctioning companies.
Until now, Kim has led NCSoft with an intense focus on Lineage. Some say there was even a sentiment within the company that "Lineage is the perfect game, so all games should be made the same way."
Park is expected to take a completely different approach to interpreting and restructuring NCSoft.
Much like how Hanaro Telecom maintained its core “wired internet” business while layering on new content like Hana TV, Park is likely to maintain Lineage’s competitiveness while seeking new business opportunities through M&A and innovation.
A game industry insider commented, “NCSoft’s biggest problem is not just the decline in Lineage sales, but the failure of all other new titles outside of Lineage,” adding, “Whether through IP acquisitions or internal development, the true test of NCSoft’s successful restructuring will be whether it can launch a completely new hit title.”
#ParkByungmoo #NCSoft #KimTaekjin #Lineage #corporaterestructuring #M&Astrategy #VIGPartners #IPTV #gamedevelopment #Koreangameindustry
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- HYBE Bets on KATSEYE to Boost Girl Group Success
- Bang Si-hyuk, chairman of HYBE and a former star music producer, played the most significant role in establishing HYBE as a dominant player in the entertainment industry. Thanks to the phenomenal success of BTS, HYBE has become the most valuable K-content company.
However, even Chairman Bang has struggled when it comes to girl groups. HYBE currently manages four girl groups under its various labels, but three of them are experiencing ups and downs.
The underperformance of its girl groups poses a challenge for HYBE as it tries to diversify its portfolio, given that its financial performance relies heavily on boy groups like BTS and SEVENTEEN.
According to the entertainment industry on the 29th, HYBE appears to be attempting a comeback in the girl group arena through "KATSEYE."
KATSEYE is a girl group under HYBE Universal, a joint venture between HYBE and Geffen Records, a subsidiary of Universal Music Group. On the 30th, the group will release a pre-release single titled “Gnarly” from their second EP. HYBE holds a 51% stake in HYBE Universal.
KATSEYE is a multinational girl group created by HYBE with the global market in mind.
This marks their return to official promotional activities about four months after their Christmas season debut in December last year. While their performance wasn’t bad back then, this new activity is crucial for HYBE given the overall lackluster performance of its girl groups.
After fromis_9, formerly under Pledis Entertainment, decided not to renew their contract, HYBE now has four girl groups: LE SSERAFIM (under Source Music), NewJeans (under ADOR), ILLIT (under Belift Lab), and KATSEYE (under HYBE Universal).
However, the outlook is not positive for the other three groups besides KATSEYE. NewJeans has suspended activities due to a management dispute between former ADOR CEO Min Hee-jin and HYBE that began in April 2024.
NewJeans is not the only group affected. Min claimed that LE SSERAFIM debuted before NewJeans unfairly and that ILLIT imitated NewJeans. Industry insiders say that these allegations have significantly damaged the public image of LE SSERAFIM and ILLIT.
Indeed, both groups have seen a noticeable drop in performance.
In the K-pop industry, the "initial album sales"—the number of albums sold within the first week of release—are considered a key metric. Both LE SSERAFIM and ILLIT have fallen short in this regard.
LE SSERAFIM sold 990,000 copies of their third mini album “EASY” in February 2024. However, their fourth mini album “CRAZY” in August 2024 and the fifth mini album “HOT” in March 2025 sold only 680,000 and 630,000 copies, respectively. All three albums were executive produced by Bang Si-hyuk, chairman of HYBE’s board of directors.
In contrast, SM Entertainment’s girl group aespa sold 1.15 million copies of “Armageddon” in May 2024 and 910,000 copies of “Whiplash” in October 2024. Compared to that, LE SSERAFIM's performance seems underwhelming.
LE SSERAFIM’s slump is reflected in the business performance of their label, Source Music. According to HYBE, Source Music recorded a net profit of KRW 6.59 billion (US$ 4.6 million) in 2024, a 50% drop compared to 2023. Quarterly figures show a consistent decline—from KRW 4.4 billion (US$ 3.1 million) in Q1, to KRW 1.7 billion (US$ 1.2 million) in Q2, and KRW 1.5 billion (US$ 1.0 million) in Q3—culminating in a net loss of KRW 1 billion (US$ 700,000) in Q4.
Given that LE SSERAFIM is the only artist under Source Music, its business performance essentially reflects that of the group.
ILLIT is also facing challenges. Their debut album “SUPER REAL ME” released in March 2024 and “I’LL LIKE YOU” released in October 2024 both recorded initial sales of 380,000 copies. The debut track “Magnetic” even reached No. 1 on Melon’s daily chart in March 2024.
However, after the ADOR controversy, the single “Cherish (My Love)” released in October only reached 52nd on the Melon daily chart—a key indicator of mainstream popularity.
The performance of HYBE’s girl group KATSEYE is drawing attention because of HYBE’s over-reliance on boy groups. From a revenue diversification and risk management perspective, it’s not healthy for a company to depend so heavily on boy group earnings.
In 2024, the combined revenue of the four HYBE subsidiaries managing its girl groups totaled KRW 570.5 billion (US$ 396.8 million), about 25% of HYBE’s total revenue. But this includes sales from boy group ENHYPEN under Belift Lab, suggesting that the actual share from girl groups is likely even lower.
HYBE’s competitors show a different picture.
At JYP Entertainment, girl groups accounted for 6.87 million out of the 13.675 million albums sold in 2024—roughly 50%. While album sales don’t directly equate to business performance due to other revenue streams like concerts and merchandise, this does illustrate a well-balanced portfolio.
At YG Entertainment, girl groups like BLACKPINK and BABYMONSTER dominate in album sales, while the boy group TREASURE leads in concert attendance. Of the 2.03 million albums YG sold in 2024, BABYMONSTER and BLACKPINK accounted for 1.59 million and 230,000 copies respectively—90% of the total. For concerts, TREASURE drew 590,000 attendees, accounting for 82% of YG’s total 720,000.
Chairman Bang also appears eager for the success of HYBE’s girl groups.
On April 22, he posted a photo on social media with members of LE SSERAFIM, ILLIT, and KATSEYE, tagging it with the hashtag #ONETEAM—signaling his strong commitment to the success of HYBE’s girl group lineup.
#HYBE #BangSiHyuk #Kpop #KATSEYE #LE_SSERAFIM #ILLIT #NewJeans #GirlGroups #KpopIndustry #EntertainmentBusiness
