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CJ Group’s Lee sells Korean cool as brother fights tax charge

Miky Lee, vice chairman of CJ Group, beams as she greets a visitor in the executive lounge of South Korea’s biggest purveyor of food, home-shopping services, TV programs and movies. Wearing a black top, charcoal leggings and midcalf Michael Kors sneakers, the 55-year-old granddaughter of Samsung Group’s founder shows no sign it’s been a traumatic last few months.

Settling in for her first major interview, Lee opens up about how she’s leading the shaken Samsung offshoot after CJ Group Chairman Lee Jay-hyun, her younger brother, was arrested in July, Bloomberg Markets magazine will report in its March issue.

“We’re now working longer, talking to more people, taking care of a lot more things, including the balance sheet,” she says in a room dominated by a portrait of Lee Byung-chull, her grandfather. “We will get back on track.”

Lee is leading Seoul-based CJ Group during a pivotal time for South Korea. President Park Geun-hye, who took office in February 2013, has promised to crack down on chaebol (large conglomerates), empower women and promote creative businesses to spark growth.

Park told Bloomberg News in a Jan. 10 interview that her administration is determined to quash unfair business practices. She tempered those comments by saying she doesn’t want to saddle companies with excessive rules.

“Having all economic participants grow to their potential, coexist and develop in harmony in a fair-market environment is our most important objective,” she said.

South Korea’s economy is picking up as Park begins her second year. After expanding 2 percent in 2012, the slowest pace in three years, gross domestic product growth will accelerate to 3.9 percent in 2014 from 2.8 percent in 2013, the finance ministry predicts. Korea is No. 2, behind China, in Bloomberg Markets’ ranking of promising emerging markets for investors.

Miky Lee helped fashion South Korea’s movies and music into a multibillion-dollar industry. Lee Mie-kyung, as she’s known in Korea, and Lee Jay-hyun, who turns 54 on March 19, turned a sugar and flour refiner their grandfather had founded in 1953 called Cheil Jedang Corp. into the country’s 14th-biggest conglomerate.

Lee Jay-hyun, known as Jay in international circles, changed the name to CJ Group in 2002. He established CJ Corp., the group’s holding company, in 2007. Revenue from CJ Group’s 76 units soared more than 16-fold from its start as Cheil Jedang in 1995 to about 28.5 trillion won ($26.3 billion) last year.

Psy’s praise

Today, CJ’s 4-D theaters surprise moviegoers with motion, wind and scents, and the splashy Mnet Asian Music Awards, known as MAMA, honor the region’s musicians.

Pop singer Psy says he was skeptical when Miky Lee began staging MAMA outside Korea in 2010. Psy came around after seeing MAMA’s popularity grow, drawing Stevie Wonder to jam with K-pop star Hyolyn and singer Aaron Kwok in Hong Kong in November.

“MAMA is one of the flowers that came into bloom by Vice Chairman Lee’s insight, who always dreamed of music and culture making all of us one,” Psy says.

David Geffen, who co-founded U.S. film studio DreamWorks SKG with Jeffrey Katzenberg and Steven Spielberg, says the Lees built their entertainment empire from scratch.

“It’s remarkable that they have gone from absolutely nothing in entertainment to incredibly successful,” he says.

At Miky’s urging, Cheil Jedang invested $300 million in DreamWorks in 1995 and won the right to distribute the then-neophyte studio’s movies in Asia outside Japan. The Lees parlayed the deal into their lucrative shift into entertainment.

“Their intention was to learn from this investment so they could build in Korea a great media company, which they did and quite a bit more,” he says. “It’s an indication of how good they are.” (Bloomberg)
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