Lotte Group ousts 92-year-old founder
The board of directors at South Korean-Japanese conglomerate Lotte Group voted this week to remove general chairman and founder Shin Kyuk-ho from his post, Japanese media reported.
The move is seen as part of a power struggle between the founder’s two sons, Dong-joo and Dong-bin, who own comparable stakes in the company, and are vying for control of the 90 trillion won ($77 billion) business.
According to Business Korea, the decision was made after eldest son Dong-joo travelled to Japan with his father earlier this week where they planned to dismiss six board members, including younger brother, Dong-bin.
In retaliation, the younger Dong-bin convened an emergency shareholders’ meeting to eject his nonagenarian father and declared his decision null and void.
Lotte Group declined to comment on why its own founder abruptly attempted to oust the board, including his second son, who until this week seemingly had the backing of his father.
The elder statesman previously stripped Dong-joo of his executive titles at three Lotte affiliated in Japan earlier this year, leading many to believe that his younger brother would be named as his successor.
Shin Kyuk-ho founded Lotte in Japan in 1948 as a snack maker, but entered Korea in 1967 and has grown the business to be the country's fifth-largest conglomerate.
Some pundits have suggested that the succession battle will continue until Shin Kyuk-ho designates his shares. The 92-year-old is thought to be in poor health.
LVMH posts second-quarter revenue rise of 23%
Leading luxury family empire LVMH said this week that second-quarter revenue rose 23% as the company benefitted from a weak euro and improved performance at its Louis Vuitton brand.
Profit from recurring operations was €2.9 billion ($3.2 billion) for the first half of 2015, an increase of 15%. Group share of net profit amounted to €1.5 billion.
Bernard Arnault, chairman and CEO of LVMH, commented: “The excellent results of the first half are witness to the efficiency of our strategy, which relies upon the strength of our brands and a very entrepreneurial style of management.
He added: “Building on the first half performances, we face the second half of the year with confidence and count on the quality of our products and the talent of our teams to further strengthen our leadership in the world of high quality products.”
Today, luxury group Christian Dior is the main holding company of LVMH, owning 40.9% of its shares, and 59.01% of its voting rights. Bernard Arnault is the majority shareholder of Dior.
LVMH was formed through the merger of fashion house Louis Vuitton with Moët Hennessy in 1987.
Sweden’s Ikea buys forest in Romania
Swedish furniture giant Ikea, owned by Kamprad family, has bought 33,600 hectares of forests in Romania, making it the largest forest owner in Romania.
Forestry has been a contentious issue in the country in recent months. Austrian family-controlled empire Schweighofer has been under investigation by the environment ministry for encouraging illegal logging, a matter that is now before the supreme court. The investigation came the same month that the business, owned by one of Austria’s wealthiest families, threatened to boycott Romania if it introduced a new code intended to reduce deforestation.
Romania’s Carpathian Mountains are home to almost half of Europe’s population of brown bears, wolves and lynx.
“The investment in woodland is a way for us to diversify our assets. We are happy to expand our forestry activities to Romania, a country that’s important for our furniture production,” said Frederik de Jong, chairman of the board at Ikea subsidiary IRI Investments SRL.
While the cost of this investment has not been revealed, market data available on the price of Romanian forestland suggests the deal could be worth €100 million.
In 2012, Ikea revealed plans to double sales to €50 billion by 2020. The business posted revenues of €29.293 billion in 2014.