With Lotte's chief in crisis, ousted brother seeks to regain power

Lotte‘s ousted vice chairman Shin Dong-joo is seeking to regain power at his family’s conglomerate as his younger brother, Lotte Group Chairman Shin Dong-bin, is caught in a web of legal troubles.

Speaking to media in Tokyo on Friday, the elder Shin said that he will be asking Lotte Holdings to reinstate him as a member of the board at the regular shareholders‘ meeting scheduled for the end of June.

“I am concerned about Lotte Group’s future and will continue to work towards normalizing management,” Shin Dong-joo said, according to the Nikkei, a Japanese business newspaper.

This is not the first time that Shin Dong-joo has sought a vote to put him back into power after he was pushed out by Shin Dong-bin. Shin Dong-joo tried unsuccessfully to push through similar motions at the Japanese Lotte Holdings last year, but Shin Dong-bin consolidated his power.

Now, as Shin Dong-bin faces trials for embezzlement and his group takes sales hits due to the fallout from a political spat between Korea and China, Shin Dong-joo hopes that he will be able to convince shareholders that the group is in trouble.

“I think that the situation is very different from last year,” he said.

Although Shin Dong-joo himself is also being prosecuted here for mismanagement of company funds, he said that the “weight” of the charges against him was different from that of the charges against Shin Dong-bin.

The task for Shin Dong-joo will be to convince the employees‘ association, which controls about a third of Lotte Holdings, to vote for him. Although Shin Dong-joo has a majority stake in Kojyunsya, which controls another third of Lotte Holdings, he will need the employees’ support to push through his proposal.

In Shin Dong-joo‘s previous two attempts to push a vote for his reinstatement, the employees had sided with Shin Dong-bin. This time, however, Shin Dong-joo seems to be hoping to change their minds.

Although it was confirmed Sunday that the travel ban on Shin Dong-bin by prosecutors had been lifted and that he would be able to travel to Japan to communicate with shareholders, he is expected to have some limitations to his efforts because he will be required to return for his ongoing trial.

“Employees are also concerned about the group’s future. They may agree to my proposal,” Shin Dong-joo said. 

By Won Ho-jung (hjwon@heraldcorp.com)