Korea’s five top conglomerates, or chaebols, have agreed to sign a letter of intent to swap affiliates by the end of August, according to a report in the Korea Herald over the weekend. A task force formed to consider the swaps was formed after pressure from the South Korean government (CI No 3,425), under the auspices of the Federation of Korean Industries. The paper says that Samsung, Hyundai, Daewoo, LG Electronics and Sunkyong Electronics have agreed to work on a blueprint involving aerospace and a couple of other industries by the end of the month. Hyundai, Samsung and LG have all been seriously hit by the slump in the memory chip market. There are three main options: the merging of several affiliates; equity purchases; and takeovers based on the purchase and assumption model. Initial plans are expected to be announced at the next scheduled meeting between the government and the businesses, set for August 31.
