[Exclusive] Hanjin Family Pushes to Sell Shares in Jeongseok Enterprise… Will 'Sibling Reconciliation' Be Achieved?

Cho Seung-yeon (formerly Cho Hyun-ah), former vice president of Korean Air and eldest daughter of the late Cho Yang-ho, founder of Hanjin Group Seon Dae (Chairman), is set to sell all her shares in Jeongseok Enterprise, the group's founding company. Attention is focused on whether her younger brother Jo Won-tae (Chairman), with whom she previously had a management rights dispute, will acquire them.

If the siblings achieve 'reconciliation' through share trading, it would be positive news for Hanjin Group. Especially amid Hoba Group steadily increasing its stake and threatening control over the company, this could become a variable in any future confrontation.

According to business circles on the 2nd, Cho's side has recently been in contact with multiple potential buyers regarding the sale of Jeongseok Enterprise shares. Jeongseok Enterprise is named after Cho Yang-ho Jo Jung-hun (Chairman), founder of Hanjin Group, and manages the group's real estate leasing operations, including Seoul Hanjin Building. It is a non-listed company wholly owned by the controlling family: Cho (former vice president) holds 4.59%, Jo Won-tae (Chairman) holds 3.83%, and Hanjin Air holds 60.49%.

Given Jeongseok Enterprise's symbolic significance, interest is focused on who will purchase Cho's shares. It is reported that several foreign-owned management-participation private equity (PE) funds are showing interest. If the deal goes through, it would mark the first time a stake in Hanjin Group's foundational company has been transferred overseas.

Jeongseok Enterprise had previously sold part of its shares to Korea Zinc during the inheritance tax payment process for Cho Yang-ho Jo (Chairman) and others between 2021 and 2025, but Hanjin Air repurchased those shares last year. This means the owner's family has maintained 100% control without any external shareholders.

For this reason, it is possible that Cho Yang-ho Jo (Chairman)'s side may acquire Cho's former vice president's stake. In that case, the siblings who previously clashed over management rights would appear to have reconciled. Earlier, Cho (former vice president) faced off against her younger brother Jo (Chairman) through a three-party alliance including KCGI (Kang Sung-bu Fund) and Bandoo Construction, but lost the management rights competition. It is now reported that Cho (former vice president) prefers selling to Jo (Chairman) rather than abroad.

Considering practical interests, there are also discussions about the necessity of Cho Yang-ho Jo (Chairman)'s side acquiring the shares. The reason why private equity funds and others claiming management participation want to become shareholders in Jeongseok Enterprise—a non-listed company where the owner's family holds 100% of the shares as the group's parent—is clear. Business circles expect that they could leverage shareholder rights guaranteed under the Commercial Act, such as the right to inspect accounting books, to pressure Hanjin Group. This would inevitably be a burden for Jo (Chairman).

A business circle official stated, "There must be reasons why the chairman has maintained 100% ownership and operated the company until now," adding, "It is understood that Cho Yang-ho Jo (Chairman)'s side is reviewing whether to acquire Cho's former vice president's shares and how to proceed."

So, what would be the value of Cho's former vice president's shares? Due to the nature of non-listed companies, it is not possible to directly calculate market prices. However, the transaction with Korea Zinc could serve as a benchmark. Last year, Hanjin Air purchased 12.22% of Jeongseok Enterprise from Korea Zinc for 52 billion won. However, industry insiders believe that considering recent trends in rising real estate prices, Cho's former vice president's stake is likely valued higher than at the time of the Korea Zinc transaction.

Another factor is that the previous transaction had a strong character of a temporary deal between friendly parties. Rather than an outright transfer of ownership, it was a buy-sell arrangement predicated on repurchase, so the price may not have been calculated rigorously.

Business circles are watching how this could impact the ongoing management rights dispute with Hoba Group. Led by Hoba Construction, the Honam-based Hoba Group has acquired 20.15% of Hanjin Air, the holding company, under the guise of "simple investment." This is only about 0.4 percentage points (p) less than Cho Yang-ho Jo Won-tae (Chairman)'s side's stake of 20.57%.

Of course, currently there is no issue as Cho Yang-ho Jo (Chairman) holds a majority stake including friendly shares. However, the 10.58% held by Korea Development Bank will likely need to be sold soon to recover public funds. Depending on who acquires this stake, there is a significant possibility of a contest for securing management control.

Another business circle official remarked, "Regardless of practicality, scenarios centered around the Honam political sphere continue to circulate," and added, "Since Korea Development Bank's share sale, which cannot be free from government influence, will become a watershed moment, public opinion is expected to be the decisive variable."

For this reason, the scenario of 'sibling reconciliation' where Cho Yang-ho Jo (Chairman) acquires Cho's former vice president's shares would also be positive for Hanjin Group. The judgment is that it is better to support those who have reconciled rather than a family engaged in internal conflict.

Regarding this share sale, Lee Ju-heon, an attorney at Songyul Law Firm representing Cho's former vice president, stated that while he did not deny the fact of the share sale, "we cannot confirm specific details."