LG is one of Korea's largest business groups. Like Samsung, the group is still firmly controlled by its founding family, now led by Koo Kwang-mo, great grandson of the man who launched the business in the late 1940s making face cream and industrial chemicals. Westerners know the company mainly as LG Electronics, Korea's second largest electronics manufacturer, sitting some way behind the mighty . Yet the group has interests in numerous other sectors, especially in its domestic market where - perhaps surprisingly - LGH&H is the leading household and personal care marketer and also the local licensee for Coca-Cola. The group has a finger in numerous other pies including telecoms, industrial manufacturing, textiles and property development. In fact, it is regarded by many as the model for modern Korean businesses, having undergone a painful restructuring from a labyrinthine "chaebol" to Western-style diversified conglomerate without the financial or political scandals which have dogged several of its competitors, such as Samsung and Lotte. It was in fact the first of Korea's chaebol conglomerates to complete the transition to a modern holding company, eliminating the maze of cross-holdings between its different operating businesses to form a single linear structure. The restructuring process came to its conclusion in 2004 with the spin-off of various retail and services businesses into a separate entity, GS Holdings, controlled by the Huh family, whose patriarch had been a co-founder of the original business. As a result, LG Corporation is now focused on three areas of Chemicals (in their widest sense, including household and personal care products), Electronics and Telecommunications & Services, each of which in turn houses several operating companies. The largest of these are publicly quoted, but are controlled by holding company LG Corporation, in most cases through shareholdings of 30% to 35%. In Korea, LG U+ is a leading provider of broadband and mobile services, competing with local leaders KT and SK Telecom. It strengthened its offering with the acquisition in 2019 of leading cable service Hello, now LG HelloVision. Other important subsidiaries include general trading company LG International and clothing company LG Fashion. GIIR is the majority controlled marketing services division, part-owned by WPP; LG Sports owns the LG Twins baseball club and LG Sakers basketball team. Several other businesses have been divested including what was once a large financial services and credit card division. Group revenues were approx $140bn in 2019, with electronics (including components) contributing around 55% of the total.
Capsule checked 2nd March 2021
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