Hanjin Group and LS Group Join Hands, Establishing an ‘Anti-Hoban Front’

LS Group and Hanjin Group have agreed to cooperate in various business areas, including the aerospace industry. While emphasizing the creation of synergies, both groups are experiencing conflicts with Hoban Group, leading to analysis that they have effectively established a joint “anti-Hoban” front.

LS and Hanjin announced on April 28 that they signed a memorandum of understanding (MOU) on April 25 to strengthen business cooperation and collaboration, aiming for mutual growth and maximization of shareholder interests. According to the agreement, the two companies plan to establish a successful collaboration model in areas such as advancing aerospace industry technology and building urban air mobility (UAM) charging infrastructure.

While the companies cited business cooperation as the reason for the alliance, the business community views it as a move to strengthen their position against Hoban Group. Both LS and Hanjin have uncomfortable relationships with Hoban.

Taihan Cable & Solution, an affiliate of Hoban Group, is building a submarine cable factory in Dangjin, South Chungcheong Province. The police are investigating allegations that LS Cable & System’s know-how from its submarine cable factory in Donghae, Gangwon State, has been leaked to Taihan. The conflict between the two groups deepened further when it was revealed that Hoban Group had acquired about 3% of LS Corp. shares during this process. LS Corp. is the holding company of LS Group.

Hanjin Group is wary of Hoban Group’s attempts at hostile mergers and acquisitions (M&A) after Hoban becane the second-largest shareholder of its holding company, Hanjin KAL. As of the end of last year, Hoban affiliates’ stake in Hanjin KAL was 17.9%, less than 3 percentage points behind the 20.13% held by Hanjin Group Chairman Cho Won-tae and his family members.