May 17, 2016

    Lotte founder's test for mental competency pivotal in sons' battle for control


    LOTTE founder Shin Kyuk Ho, 95, was admitted to Seoul National University Hospital yesterday for a mental competency evaluation, the results of which will play a crucial role in his sons' battle over control of the Lotte corporate empire.

    The evaluation is a part of the ongoing suit brought by Mr Shin's younger sister Jung Sook in December, which claimed that his deteriorating mental state required him to have a legal guardian.

    The outcome of the evaluation will have considerable sway over the public squabble between Mr Shin's two sons - Dong Joo and Dong Bin.

    The older brother Dong Joo, who had previously controlled Lotte's Japanese operations, was removed from his post while Dong Bin was promoted to co-chief executive of Lotte in Japan.

    Last July, founder Kyuk Ho suddenly dismissed six board members of Lotte in Japan, including Dong Bin.

    The move was ostensibly orchestrated by Dong Joo, who had come back into his father's favour.

    Returning fire, Dong Bin dismissed his father at an emergency board meeting, saying that the latter's unilateral actions were void as they did not have board support.

    Although Dong Bin currently holds the support of the shareholders in both South Korea and Japan, Dong Joo continues to claim that he has been named the legitimate successor by the father.

    Dong Bin claims that his father cannot name an heir because he has grown mentally incompetent with age.

    The mental evaluation of Kyuk Ho that began yesterday will present evidence for or against that claim.

    He was accompanied to the evaluation by his elder son.

    In the face of opposition from both the Lotte founder and Dong Joo, it is unlikely that Dong Bin will turn up at the hospital to visit his father.