Industry Material
NEWS
2nd and 3rd generation from entrepreneurs are not interested in 'management succession'... up to the top ranked company in the industry is on sale Cutting tool manufacturers, JJ Tools, and other companies sold their shares one after another
Sep 08, 2021, 11:16
A son who had a doctoral degree in engineering works in the information technology (IT) field instead of corporate succession from his parents. A daughter who is a doctor wants a transfer of cash bestowal instead of company’s share. This is the case of a mid-sized company that recently requested a large domestic accounting firm to sell the company. In the last two or three years, the number of corporate listings following this succession failure has increased sharply. This year, it reached an all-time high on a semi-annual basis.
Hanssem, the top ranked home furnishing brands in Korea and SM Entertainment, the first-generation entertainment agency, are representative examples of the decision to sell shares instead of succession this year. MS Savings Bank, based in Daegu and Gyeongbuk with 40 years experiences, also sold it to SK Securities instead of inherit it on to their son and daughter when the burden of inheritance tax. In the past five years, 181 cases of individual major shareholders sold management right included Cleantopia, Taehwa, Seungmyung, Taelim Packaging, JJ Tools, EZwell, and Sungwon Industries.
JJ Tools, a cutting tool manufacturer established in 1997, is a domestic small giant with unrivaled technology and market share in the production of ultra-precision end mills.
Since it is a net exhaust company with an operating profit margin of over 50%, it has received interest from global material and equipment companies, including domestic, for its acquisition. Started looking for a management partner.
The CEO said that It is desirable to utilize external support through FI (Financial Investors) rather than handing over management rights to still young sons.
Inheritance tax burden is also considered to be a factor contributing to the sale of mid-sized companies. The highest rate of inheritance tax in Korea is 50%, but if the share is given by the largest shareholder, it is close to 60%. “There are deductions for family business succession and special taxation systems but included job retention condition so second generations have tendency to ‘cash bestowal’ ” said an official from a small and medium-sized business-related organization.
For more information on JJ Tools, please visit www.jjtools.co.kr
[Company Information]
Contact : Tel : +82-2-808-2745/ Email : jjtools@naver.com
Related Link : www.jjtools.co.kr
Written by Hanmir PRNews
► This is a news release distributed by Hanmir PR news on behalf of JJ Tools
► News provided JJ Tools
#management right #unrivaled technology #cutting tool manufacturer #net exhaust company #tax burden
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