Daewoo Group Founder Dies Nine Days Before His 83rd Birthday

Published December 12th, 2019 - 11:30 GMT
Daewoo Group Founder Dies Nine Days Before His 83rd Birthday
Kim started his career as a salesman in 1963 and founded Daewoo in 1967. (AFP)
Highlights
Kim died Monday, nine days before his 83rd birthday

Kim Woo-Choong, the disgraced founder of the now-defunct Daewoo Group, has died at age 82 at a hospital near Seoul. Daewoo was once Korea's second-largest business conglomerate. 

Kim died Monday, nine days before his 83rd birthday, at a hospital in Suwon after battling chronic disease over the past year, according to the Daewoo Sky Institute, an organization of former Daewoo employees.

Kim started his career as a salesman in 1963 and founded Daewoo in 1967, which experienced rapid growth over the next three decades.

His go-to strategy was to aggressively tap into the global markets based on massive bank loans. The leveraged expansion swelled the Seoul-based group to one of the biggest chaebols -- enterprises in which founding families exercise vast control despite their small direct shareholdings -- comparable to Samsung and Hyundai.

At its peak in the late 1990s, Daewoo had 41 subsidiaries in South Korea and about 600 branches overseas, hiring up to 350,000 people across the world, the institute said.

Daewoo struggled to find its feet after South Korea suffered a financial crisis in 1997 and 1998, which forced the country to seek a bailout from the International Monetary Fund.

Against this backdrop, Daewoo group collapsed in 1999 with debts of about $80 billion, prompting a government bailout.

Its subsidiaries were sold to buyers at home and abroad. For example, its trading arm, Daewoo International, was acquired by South Korea's top steelmaker, POSCO, in 2010. Daewoo Motor was purchased by General Motors in the early 2000s.

As Daewoo collapsed in the worlds' biggest bankruptcy, Kim fled the country. He returned in 2005 after six years of exile and was charged with embezzlement, accounting fraud and foreign exchange law violations. He was sentenced to 8 ½ years in prison, ordered to forfeit $19 billion and pay a fine in 2006.

Two years later, he received a presidential pardon.

In recent years, Kim tried to foster young entrepreneurs in Vietnam, Myanmar and Indonesia.

Some in the business community mourned Kim's death, praising him as a pioneer who led the country's industrialization and globalization.

Kim is survived by his wife, Chung Hee-ja, and three children.


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