Ourhome, the catering unit of LG Group, put an end to a yearslong management dispute as younger siblings of the owner family united to remove the elder and only son as CEO.
Shareholders and board members of the food service operator on Friday passed the motion to dismiss CEO Koo Bon-sung from his top post in a meeting, after he became involved in a scandal and as the company‘s business took a hit.
The board named Koo Ji-eun, the youngest sibling of the four, as the new CEO. Koo was previously head of the company’s subsidiary Kalisco, which is the operator of restaurant franchise brands such as Saboten and Taco Bell.
The latest leadership upheaval was the result of a prolonged proxy battle between Koo and his three younger sisters -- Mi-hyun, Myung-jin, and Ji-eun. The three sisters hold a combined 59.6 percent stake in the company, overwhelming their elder brother’s 38.6 percent.
The ousting was made possible after 21 new members -- all in favor of the sister alliance -- joined the original 11-member board on Friday.
Back in 2015, Koo Ji-eun had to yield the management to her elder brother, as Mi-hyun voted for him at the time with her 19.3 percent stake.
Since then, Kalisco has been at loggerheads with Ourhome, even switching its key food material provider to Shinsegae Food in 2019.
The apparent clincher in the dramatic leadership change was the evicted CEO’s involvement in a “road rage” scandal last year, for which he was given a two-year suspended sentence.
The company’s struggling financial conditions also acted against the elder brother who had been at the helm since 2016.
Though the company has not yet disclosed its final business performance for 2020, it logged a net loss of 14.8 billion won ($13.3 million) as of end-June last year. Its half-year revenue came to 804 billion won, down 12.5 percent on-year.
As an affiliate of LG Group, Ourhome was founded in 1984 by Koo Ja-hak, the third son of the group’s founder Koo In-hoe. The dismissed Koo is cousin to LG Group Chairman Koo Kwang-mo.
By Bae Hyun-jung (firstname.lastname@example.org