Two years in, Hanwha mulls sale of Five Guys Korea
According to sources on Thursday, FG Korea, a wholly owned subsidiary of Hanwha Galleria, recently circulated documents to private equity firms through local accounting firm Samil PwC signaling a potential sale process.
Although no deal terms or valuation have been finalized, a full sale of the 100 percent stake appears likely if a deal materializes, the sources explained.
Five Guys entered the Korean market in June 2023 as one of the pet projects led by Hanwha Galleria Vice President Kim Dong-seon, the youngest son of Hanwha Group Chair Kim Seung-youn.
The potential sale comes as Hanwha Galleria looks to streamline its portfolio and cut costs, including royalty payments to Five Guys' US headquarters, though contractual obligations with the franchisor limit unilateral decision-making.
'We are reviewing a range of options in consultation with the global headquarters to reinforce the brand's competitive edge,' Hanwha Galleria said in a regulatory filing, adding that no final decisions have been made and that further developments will be disclosed within a month.
Since entering the Korean market, the company has expanded from its first location in Gangnam, southern Seoul, to seven stores, with an eighth set to open later this month at IPark Mall in Yongsan, central Seoul.
Last year, the company signed a memorandum of understanding with Five Guys International to lead the brand's expansion into Japan, with a goal of opening over 20 stores in seven years.
FG Korea turned a profit last year, posting 46.5 billion won ($33.4 million) in revenue, 3.4 billion won in operating profit and 2 billion won in net income.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Korea Herald
7 hours ago
- Korea Herald
Kolmar Korea Launches Full Operation of 2nd US Factory, Establishing K-Beauty's 'Tariff Safe Zone' in America
OLYPHANT, Pa. and SEOUL, South Korea, July 22, 2025 /PRNewswire/ -- Kolmar Korea has officially completed construction and begun full-scale operations of its second manufacturing facility in the United States, the world's largest cosmetics market. Located in Scott Township, Pennsylvania, the new plant represents a key strategic move to bolster K-beauty's global footprint while creating a US-based 'tariff safe zone' amid rising trade shocks. At the factory completion ceremony held on July 16 (local time), Yoon Sang Hyun, Vice Chairman of Kolmar Group, outlined the company's broader global ambitions. "The US is where Kolmar's journey began a century ago. This second factory is not merely a production site but the starting point for a new vision of collaboration and growth. We will build an innovation ecosystem alongside diverse value chain partners to establish the largest cosmetics manufacturing hub in North America," he said. The ceremony was attended by Vice Chairman Yoon, Pennsylvania State Representative Bridget Kosierowski, state government officials, and affiliated organizations — with around 100 participants present. The newly completed facility spans 17,805㎡ (191,651 square feet) with an annual production capacity of 120 million units. Combined with Kolmar USA's first factory, the company now boasts a US production capacity of 300 million units annually. Including its Canadian operations, Kolmar Korea commands a total production capacity of 470 million units across North America — the largest among cosmetics ODMs(Original Development Manufacturer) on the continent. Specializing in skincare and suncare products — categories seeing surging demand in the US — the second factory complements the color cosmetics capabilities of the first plant. Kolmar Korea is also now certified by the US FDA with an OTC (Over-the-Counter) license for sunscreen manufacturing, enabling the company to respond swiftly to the growing K-sunscreen trend in the US market. Importantly, Kolmar Korea has transferred its advanced 'MADE BY KOLMAR' manufacturing expertise, honed at its Sejong Plant in Korea and recognized by over 4,300 global customers, to the new US facility. The factory was designed to replicate Sejong's high standards, with specialized zones for manufacturing, filling, and packaging. The integration of cutting-edge AI-powered quality monitoring and process optimization ensures minimal defect rates, while 80% of production is fully automated. Logistics systems and worker movement pathways were also modeled after the Sejong facility to maximize both efficiency and safety. Kolmar Korea anticipates the second factory will serve as a critical base for avoiding US tariffs on imported cosmetics, providing a robust local production option for both Korean and global brands looking to expand in the US market. A Kolmar Korea spokesperson remarked, "This is the first time a Korean cosmetics company has directly built a production facility in the US rather than acquiring one, making it a landmark achievement. We're ready to support K-beauty brands looking to enter the US market without tariff concerns, as well as global customers aiming for North American, European, and South American markets. Our collaboration ecosystem is poised for rapid expansion".
Korea Herald
14 hours ago
- Korea Herald
Seoul shares sink over 1% ahead of tariff deadline, Q2 earnings
Seoul shares closed sharply lower Tuesday as investors cashed in recent gains amid uncertainties with US tariff policies and upcoming corporate earnings. The Korean won rose against the US dollar. The benchmark Korea Composite Stock Price Index fell 40.87 points, or 1.27 percent, to close at 3,169.94. Trade volume was moderate at 375.19 million shares worth 11.39 trillion won ($8.2 billion), with losers outnumbering winners 686 to 208. Institutional and foreign investors sold 413.94 billion won and 160.97 billion won worth of stocks, respectively, while individuals bought a net 511.44 billion won in shares. "Institutions and foreigners turned net sellers after buying local stocks for the past three and eight sessions, respectively, weighing on the market," said Lee Jae-won, an analyst at Shinhan Securities Co. In contrast, retail investors turned net buyers after selling for the previous three sessions. All eyes are on possible changes to US tariff policies, as President Donald Trump may announce new unilateral tariffs before Aug. 1, analysts said. Investors are also awaiting second-quarter corporate earnings, due this week, for clues about the market's direction, they added. In Seoul, most large-cap stocks declined. Market bellwether Samsung Electronics fell 2.65 percent to 66,000 won, and smaller chipmaking rival SK hynix declined 1.47 percent to 268,500 won. Top carmaker Hyundai Motor dropped 1.2 percent to 206,500 won, leading shipbuilder HD Hyundai shed 0.8 percent to 136,100 won, and No. 1 steelmaker POSCO Holdings lost 1.22 percent to 323,000 won. Among gainers, leading battery maker LG Energy Solution rose 0.76 percent to 333,500 won, and LG Chem climbed 0.7 percent to 289,000 won. Leading wireless services provider SK Telecom gained 1.07 percent to 56,500 won, and state-run utility firm Korea Electric Power Corp. was up 0.27 percent to 37,250 won. The local currency was quoted at 1,387.80 won against the US dollar at 3:30 p.m., up 0.4 won from the previous session. (Yonhap)
Korea Herald
15 hours ago
- Korea Herald
Checks, gaps, global voices: The evolving face of Korea's bank governance
Governance reforms gain ground amid uneven progress on diversity, independence South Korea's financial giants have been working to shed their long-standing reputation for rubber-stamp governance, as diversity and boardroom expertise have visibly improved. Yet, with CEOs and legacy ties still exerting implicit power in some high-level conference rooms, the extent to which boards can hold management accountable remains in question. All four of Korea's top financial groups now have at least two female outside directors, with women holding an average of 32 percent of those seats. Shinhan leads with four of nine, followed by KB with three of seven, Hana with three of nine and Woori with two of seven. Notably, the female directors are, on average, more than a decade younger than their male peers — suggesting that gender inclusion is also fostering generational renewal. Average board ages cluster between 61 and 63, with Shinhan and Woori the youngest at roughly 61.7 years old. However, none of the boards currently includes a foreign national. The last was Stuart B. Solomon, a former MetLife executive who left KB in 2022. The absence is especially striking given that foreign investors now hold an average 63 percent stake across the four groups — more than six times the Kospi average. While not legally mandated, foreign directors are widely seen as a marker of governance transparency and stronger representation of foreign shareholders' interests. Strengthening internal oversight was the dominant theme in board appointments across Korea's top banking groups this year. Woori made the most sweeping changes, replacing four of its seven outside directors after a high-profile internal control failure led to regulatory scrutiny. It also launched an ethics and internal control committee and revamped its audit committee. New appointees include Kim Choon-soo, a compliance specialist and former head of Eugene Group's ethical management division, and Rhee Yeong-seop, a Seoul National University professor with expertise in economics and financial regulation — both expected to strengthen the group's internal controls. To support Woori's digital transformation, tech entrepreneur Kim Young-hoon, a founding member of Daou Tech, also joined the board. Still, gaps remain. Woori's board skill matrix highlights a lack of expertise in consumer protection and legal affairs — areas that need strengthening going forward. The other three groups, with more balanced skill coverage, emphasized continuity while selectively shoring up governance capabilities. Shinhan added two new directors with deep ties to Japan, preserving its long-standing alignment with the Korean-Japanese community and maintaining the share of third-generation Korean Japanese outside directors. New appointees include Chun Myo-sang, a third-generation Korean Japanese and certified public accountant in Japan, and Yang In-jip, a Korean national with extensive professional experience in Japan, including as a tech CEO and former chair of the Korean Business Association in Japan. This enduring alignment reflects Shinhan's founding roots — established with capital from Korean Japanese investors in the 1980s — and continues to serve as a stabilizing force in its governance. KB maintained board stability while adding targeted expertise. New appointees include Ewha University economics professor Chah Eun-young and E-Jung Accounting CEO Kim Sun-yeop, bolstering regulatory and audit oversight. A new internal controls committee is chaired by Lee Myong-hwal, a veteran economist and policy expert. Notably, KB limits outside director terms to five years, shorter than the industry's six-year norm, underscoring its commitment to board renewal. Hana made minimal changes, but focused on governance upgrades. It established an internal controls committee and added Suh Young-sook, former chief credit officer at SC Bank Korea, as its only new outside director. Though modest in scope, the move raised Hana's female director ratio and added global credit expertise. Despite formal efforts to separate management and oversight, executive influence remains entrenched. At KB and Shinhan, the CEOs of their flagship banks — Lee Hwan-ju and Jung Sang-hyuk, respectively — sit on the holding company's board as 'nonstanding' directors: nonexecutive, nonindependent, but voting members who serve on committees. These positions blur the boundary between oversight and management. Hana goes further, including not only its CEO, but also two vice chairs — Lee Seung-lyul and Kang Seong-muk — on the board. In 2024, the group expanded its board to 12 members — the largest among its peers — by adding external directors to balance the increased number of internal seats. Notably, Lee remains a board member even after stepping down as Hana Bank CEO, reinforcing the view that these seats function as power bases for the group's CEO Ham Young-joo, who secured a three-year term extension in March. As foreign ownership rises, investor communication is increasingly seen as a measure of governance openness. All four groups now provide English-language disclosures, translated shareholder materials and access to electronic voting — but depth and quality still vary. Shinhan and Woori lead in outreach. From July 2024 to June this year, Shinhan held eight investor sessions involving board members, along with 24 CEO- and 43 chief financial officer-level meetings. It offers disclosures in Korean, English and Japanese and commissions third-party board evaluations. Woori conducted over 100 foreign investor meetings during the year, many attended by the CEO, signaling volume and senior-level commitment. Hana and KB focus on accessibility. Hana has held two annual investor roundtables since 2022, with full participation from outside directors. This year, it scheduled one at 10 p.m. local time to accommodate North American shareholders. KB upgraded infrastructure this year with simultaneous interpretation and livestreaming of shareholders meetings, while tailoring voting procedures for institutional and American Depositary Receipt holders. Woori, Shinhan and KB — each listed on the New York Stock Exchange — also file English-language disclosures via the US Securities and Exchange Commission, alongside Korean regulatory filings. Still, global investors see room for improvement. More frequent board engagement and clearer channels for shareholder input remain key. Amar Gill, secretary-general of the Asian Corporate Governance Association, stressed that board-level dialogue is essential not just for transparency, but to strengthen the boards themselves. 'There should at least be a designated point person on the board for foreign investors to engage with,' Gill told The Korea Herald. 'The most important part is engagement with investors at the board level, particularly from independent directors. They should be getting feedback from the market. That is how they are empowered.' He also stressed that logistical improvements around annual shareholders meetings are needed to support non-Korean shareholders. 'Two to three weeks' notice is not enough. It should be at least a month in advance. And foreign investors attending should be able to ask questions.'
