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YTN headquarters building in Sangam-dong, Mapo District, Seoul. (Photo courtesy of Yonhap News) |
[Alpha Biz= Kim Jisun] Seoul – The Korea Fair Trade Commission (KFTC) has opened an investigation into allegations of unfair internal transactions and illicit support involving the controlling family of Eugene Group, the largest shareholder of news broadcaster YTN.
On September 8, industry sources confirmed that KFTC officials conducted an on-site inspection at the headquarters of Eugene Corporation in Yeouido, Seoul, located in the Eugene Building, to collect evidence related to possible violations of the Fair Trade Act.
The probe follows a complaint filed in June by civil society and media advocacy groups, accusing Eugene Group’s founding family of private interest appropriation.
Allegations Under Review
The Eugene Building, housing Eugene Group’s core affiliates, is owned by Cheonan Enterprise, a real estate leasing company established in 1996 by Chairman Yoo Kyung-sun and his family with initial capital of KRW 200 million.
In 2015, Cheonan Enterprise purchased the Eugene Building for KRW 64.5 billion. Critics allege the group unfairly supported the family by arranging a total return swap (TRS) contract and providing KRW 76 billion in debt guarantees.
Additional allegations have emerged over Cheonan Enterprise’s share acquisition. Eugene Corporation reportedly paid KRW 24.6 billion to Yoo’s family for equity, raising suspicions of overvaluation and improper enrichment.
Civil groups claim that Cheonan Enterprise’s value was artificially inflated, and that profits from internal transactions have flowed directly into the hands of the Yoo family.
The KFTC is expected to expand its inquiry to determine whether Eugene Group’s practices constitute a breach of Korea’s fair trade and anti–tunneling regulations.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
