The seeds of the dispute were planted when the family patriarch passed away in August 2020, leaving the family with an eye-popping inheritance tax bill of approximately KRW540 billion ($479 million). Korea’s inheritance tax rates are among the highest in the world, with controlling shareholders subject to a rate of up to 60%.
Investors should review the business’s succession plans, particularly for family-run companies, before taking the plunge
The story of Hanmi Pharmaceutical serves as a cautionary tale for investors seeking to put their money in family-run businesses. Between May and July 2024, the share price of Hanmi Pharmaceuticals dropped by nearly 17% as a power struggle played out between the late founder Lim Sung-Ki’s two sons and their mother and sister. During this period, the former removed their mother as co-CEO of Hanmi Science, the holding company of Hanmi Pharmaceuticals.
