According to financial insiders, SK Group is urgently evaluating the implications of the recent ruling on Chairman Chey’s future business ventures.
Although the conglomerate has yet to release an official statement regarding the case, internal sources reveal a sense of astonishment at the unforeseen verdict. .The image shows SK Group Headquarters in Seorin-dong, Jongno-gu, Seoul, South Korea (Yonhap)
SEOUL, May 31 (Korea Bizwire) –In a landmark ruling that could upend one of South Korea’s biggest conglomerates, a court has ordered Chey Tae-won, the chairman of the SK Group, to pay his ex-wife a massive 1.38 trillion won as part of their divorce settlement.
The staggering sum, among the largest divorce payouts worldwide, is leaving Chey scrambling to raise funds and fueling concerns about the future control of SK, a $150 billion energy-to-telecom empire.
The Seoul High Court upheld an earlier ruling that awarded 42% of the couple’s wealth to Chey’s ex-wife, Roh So-young, a former art gallery director. If the Supreme Court upholds the verdict, Chey may be forced to sell shares or use his stake as collateral for loans, potentially diluting his family’s grip on the corporate empire his grandfather founded in 1953.
“We were too shocked by the unprecedented ruling,” said an executive at an SK affiliate, speaking on condition of anonymity. “We will have to assess how this might impact the group going forward.”
In a statement, Chey’s legal team expressed “deep regret” over what it called an “excessively biased” ruling, vowing to appeal to the Supreme Court to “correct the mistakes.”
The lawyers argued that SK had provided resources to Roh’s family under pressure from her father, the former president Roh Tae-woo, and that the verdict unfairly tarnished the company’s reputation based on “speculation and misunderstanding.”
If the Supreme Court upholds the verdict, Chey may be forced to sell shares or use his stake as collateral for loans, potentially diluting his family’s grip on the corporate empire his grandfather founded in 1953. (Image courtesy of Yonhap)
The ruling caps a decade-long legal battle that burst into public view in 2015 when Chey revealed in an open letter that he had fathered a child out of wedlock and could no longer maintain his marriage to Roh.
The couple, who met as students at the University of Chicago in the 1980s and married in an opulent ceremony at the presidential Blue House, had reportedly been estranged for years.
In her own media interviews, Roh, 63, said the 66.5 billion won settlement awarded by a lower court in 2022 devalued her contributions over 34 years of marriage in supporting her husband and raising their three children as SK grew into a massive conglomerate worth more than 100 trillion won.
The ruling underscores the intertwined relationships between South Korea’s powerful corporate empires and the political elite that guided the nation’s rapid economic rise.
The court accepted Roh’s argument that her family’s financial support from SK during her father’s presidency from 1988 to 1993 helped build the group’s wealth.
At the center of the dispute is Chey’s 17.7% stake in the SK Corporation holding company, worth around 2 trillion won at current prices. He also holds shares in affiliates like SK Innovation, SK Square and semiconductor maker SK Siltron, formerly owned by LG.
“Old good days” Chey Tae-won, chairman of SK Group, and Roh So-young, director of the art center Nabi, in 2003. (Image courtesy of Yonhap)
Analysts say Chey may seek bank loans using his SK shares or SK Siltron stake as collateral to pay the divorce settlement if the Supreme Court ruling goes against him. However, they warn a rushed sale of the unlisted SK Siltron shares could undervalue them.
“Chey will likely not give up his SK stake given his experience with the near loss of control in 2003,” said Park Joo-geun of Leaders Index. He was referring to an attack by the U.K. investor Sovereign Asset Management that pushed for new leadership before Chey prevailed.
Beyond the divorce payout, some analysts think Chey may need to sell part of his SK stake if he cannot raise enough through loans, leaving him more vulnerable to challenges to his family’s control.
The ruling could also tarnish SK’s image as it has aggressively promoted environmental, social and corporate governance principles, analysts say. An SK executive expressed hope the legal risk has been resolved, allowing the company “to focus on business.”
M. H. Lee (mhlee@koreabizwire.com)
