Jungheung Group Chairman Jung Chang-sun, left, and KDB Investment CEO Lee Dae-hyun pose at Four Seasons Hotel Seoul, after signing an agreement on Jungheung Group's acquisition of Daewoo E&C from KDB Investment in this December 2021 file photo. Courtesy of Jungheung Group

By Park Jae-hyuk

Jungheung Group appears to be accelerating efforts to take control of Daewoo E&C, as its chairman's grandchildren were transferred recently to the newly acquired subsidiary in the wake of its latest reshuffle which saw the dismissal of a significant number of executives.

According to industry officials, Thursday, Jungheung Group Chairman Jung Chang-sun's grandson, who was born in 1998, joined Daewoo E&C's strategy planning team as its leader.

The son of Jungheung Group Vice Chairman Jung Won-ju is said to have joined the Gwangju-headquartered construction company last year, after finishing his military service. He was reportedly among the group's taskforce members who handled the post-acquisition integration process.

Two sons of the chairman's daughter also moved from Jungheung to Daewoo E&C as members of its procurement team and ESG team, respectively, according to industry officials.

Although their father, Herald Corp. Executive Vice President Kim Bo-hyun, was initially supposed to be appointed as executive director of Daewoo E&C, he was barred from joining the builder's board of directors. As a retired Air Force general, he is ineligible for employment by a private enterprise capitalized at over 1 billion won ($831,000), until three years after the end of his military service in April 2020.

There is speculation that Kim, the son-in-law of the Jungheung chairman, will join Daewoo E&C next year as the head of its management support department, considering that the company did not fill that position in its recent executive reshuffle.

In addition to the chairman's family members, many Jungheung executives who took part in the Daewoo E&C acquisition deal were appointed to key positions of the new subsidiary, after the Fair Trade Commission allowed the medium-sized builder to take over its larger rival.

Some critics pointed out that Daewoo E&C's recent executive reshuffle was contradictory to the Jungheung Group chairman's promise to guarantee the subsidiary's "independent management."

However, unionized workers at Daewoo E&C, who stopped their nine-month protest in February after they reached an agreement with Jungheung's management, have remained silent about this issue.

"It is difficult for us to comment at this moment, as we have yet to clarify our official position," the Daewoo E&C union's deputy chairman said.