Founder of Kolmar, Yoon Dong-han, files 'stock return lawsuit' against his eldest son… Management conflict surfaces
Yoon Dong-han, the founder of Kolmar Group and chairman of Korea Kolmar, has filed a stock return lawsuit against his eldest son, Yoon Sang-hyun, vice chairman of Kolmar Holdings. Observations suggest a rift in the second-generation management structure, leading to a full-blown legal dispute within the group.
On the 18th, Kolmar Biotech reported that Chairman Yoon filed a lawsuit against Vice Chairman Yoon on September 30 at the Seoul Central District Court, demanding the return of shares from Kolmar Holdings.
The shares in question are 2.3 million shares of Kolmar Holdings, which Chairman Yoon gifted to Vice Chairman Yoon in December 2019 (now 4.6 million shares following a stock split).
The complexity of the sibling management structure… Has the 'agreed succession' been broken?
Currently, Yoon Sang-hyun holds 31.75% of Kolmar Holdings, while Chairman Yoon holds 5.59%, and Yoon Ye-won, the eldest daughter and CEO of Kolmar Biotech, holds 7.45%. This lawsuit appears to stem from a conflict between Kolmar Holdings and Kolmar Biotech, each represented by the eldest son and eldest daughter respectively.
Previously, Kolmar Holdings sought permission from the Daejeon District Court for an extraordinary general meeting to appoint Yoon Sang-hyun and former CJ CheilJedang Vice President Lee Seung-hwa as inside directors of Kolmar Biotech. The Kolmar Holdings side expressed that growing shareholder dissatisfaction due to poor performance and falling stock prices made it inevitable to reorganize the board of directors to fulfill its responsibilities as the largest shareholder.
In response, Kolmar Biotech countered, stating, "It is difficult to understand why past performance is suddenly questioned at a time when performance improvement is becoming visible."
Chairman Yoon also publicly stated at the group's 35th anniversary ceremony last month that "the agreement for Yoon Sang-hyun to manage Korea Kolmar and Yoon Ye-won to manage Kolmar Biotech is still valid," attempting to de-escalate the conflict.
"The stock gift had a premise"… Founder shifts direction towards judicial mediation
According to Kolmar Biotech, Chairman Yoon entered into a three-party management agreement with his two children, Yoon Sang-hyun and Yoon Ye-won, in September 2018.
The key content was that, in terms of governance structure, Yoon Sang-hyun would be responsible for Kolmar Holdings and Korea Kolmar, while Yoon Ye-won would exercise business management rights based on the independence and autonomy of Kolmar Biotech.
The legal representative of Chairman Yoon stated, "This stock return lawsuit is a measure taken because Yoon Sang-hyun attempted to unilaterally change the agreed succession structure by abusing his position as the largest shareholder." He added, "If Chairman Yoon had been aware of this situation, the gift would not have been made."
The sustainability of a 'sibling management' system based on management separation and mutual cooperation after the founder's death is expected to be tested by this legal battle. Analysts suggest that since Chairman Yoon is directly engaging in legal action, the possibility of restructuring the group's governance cannot be ruled out.
Image sources: Yoon Dong-han, founder of Kolmar Group / News1, Yoon Sang-hyun, vice chairman of Kolmar Holdings / News1, Yoon Ye-won, CEO of Kolmar Biotech / Photo: Kolmar Biotech
