SEOUL, Feb. 24 (Korea Bizwire) — CJ Korea Express, CJ Group’s logistics arm, has failed in its takeover bid for APL Logistics, allegedly due to group chairman Lee Jae-Hyun’s absence, which has been ongoing for two years now. Lee Jae-Hyun is currently hospitalized, with the Seoul High Court’s verdict on him still effective. He was sentenced to three years in prison and fined for malpractice and tax evasion.
CJ Korea Express was considered to be an ideal candidate to buy APL Logistics last year, but it lost the deal to Japan’s Kintetsu World Express (KWE) on February 13. The APL Logistics buyout was to bring CJ Korea Express an opportunity to compete with global logistics companies, as its acquisition target is a strong holder of Asian and North American distribution networks regarding various products ranging from automobiles to electronics.
This fallout is supposedly due to a lack of clear and purposeful decision making from the group’s current CEO Sohn Kyung-Shik, according to a high-ranking CJ Group official. This individual said that the group’s current CEO and board members are bound to make conservative decisions when it comes to setting prices.
The individual also said that the absence of Lee Jae-Hyun is finally starting to affect the group in a substantial way. Although several firms have approached CJ to make deals to expand CGV theaters in South Asian markets, and to propose a merger with CJ O Shopping, no progress has been made due a lack of decisive execution, said the individual.
The group’s investment in 2013 during Lee’s absence was 2.6 trillion won (US$ 2.34 billion), which was 20 percent lower than the planned amount. CJ Group had been expanding its investment up until 2012.
By M.H. Lee (email@example.com)