April 26, 2024

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[THE INVESTOR] Inter-unit transactions of Korea’s business groups accounted for nearly 16 percent of the agenda items for large companies’ board meetings in 2017, a market tracker said on March 28.

According to CEO Score, transactions among affiliates took up 15.8 percent of the 5,955 agenda items presented for last year‘s board meetings of 243 listed companies belonging to 57 conglomerates.

Items related to business and management reached the largest 1,686 cases, or 28.3 percent of the total. Financing and lending came next with 1,046 cases (17.6 percent), followed by personnel issues with 1,039 (17.4 percent).

Hyundai Motor Group posted the highest portion of internal deals to total agenda items with 40.2 percent. Issues related to the group’s cross-unit deals numbered 94, compared with the total 234 agenda items.

Online gaming firm Nexon placed second with 35.5 percent (11 cases), retail giant Shinsegae with 34.7 percent (61 cases) and Samsung Group with 31.2 percent (124 cases).

Korea’s antitrust regulator keeps close tabs on intra-group transactions, which result in awarding lucrative deals to companies within the business group. The practice effectively blocks out other companies from competition and distorts fair market rules.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)