Chaebol criticized for handing shares to minors in advance to pay less gift tax

2013-08-19 10:54

Chaebol criticized for handing shares to minors

The number of stock-rich South Korean minors jumped 10 percent this month from a year earlier, data showed Monday, as more rich people handed over wealth to their offspring in advance to pay less gift tax. According to the data by local research firm Chaebul.com, the number of minors with shares worth more than 100 million won ($89,887) came to 268 as of Friday, compared to 243 tallied a year earlier. The number of South Korean minors with shares worth more than 1 billion won also jumped 31.3 percent over the cited period to reach 105, the data also said. Of the minors tallied, seven of them had shares worth more than 10 billion won. The richest in terms of value of shares held was the GS Group’s Executive Vice President Huh Yong-su’s eldest son, whose shares were worth 44.5 billion won, trailed by his second son at 18 billion won. The eldest son of Chung Mong-jin, who heads chemicals maker KCC Corp., ranked third with 17.2 billion won. The research firm said the on-year increase was brought on by a drop in the local bourse this year that made it cheaper for stockholders to turn over shares to their kids. Lower stock prices translate into lower gift taxes. South Korea’s benchmark Korea Composite Stock Price Index (KOSPI) closed at 1,920.11 Friday, down 1.97 percent from 1,957.91 tallied a year earlier. (Yonhap)

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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