[THE INVESTOR] Sungjoo Group founder Kim Sung-joo has resigned as CEO of accessories brand MCM, according to news reports on June 26.
Kim quit the position to focus on MCM’s further expansion in overseas market, said the company, but industry watchers speculate the decision may be related to an ongoing investigation by the Korea Fair Trade Commission.
In March, four of its subcontractors filed complaints against the company saying they suffered from its unfair pricing and refunding practices that ultimately led to their bankruptcy.
Sungjoo Group claimed that the subcontractors demanded 10 billion won (US$8.80 million) without valid reasons, adding that it will take responsibility if the allegations are true.
After the Korea Fair Trade Mediation Agency failed to resolve differences the case was referred to the FTC.
Since acquiring Germany-based MCM in 2005, Kim nurtured it into a global brand with more than 300 outlets in 30 countries that generated 590 billion won revenue in 2014. However, it has been losing market share with the operating profit of Sungjoo D&D, manufacturer and seller of MCM, down to 65.2 billion won last year from 77.2 billion won in 2014.
Kim had earlier resigned as the chairman of Korean Red Cross with only four months of her three-year term remaining. Her appointment in 2014 was controversial as she was one of the staunchest advocates of then-President Park Geun-hye.
By Hwang You-mee (firstname.lastname@example.org)