South Korean finance tycoon Cho Jung-ho is edging closer to ending Samsung Electronics Co. Executive Chairman Jay Y. Lee’s two-and-a-half-year reign as the nation’s richest person. Meritz Financial Group Chairman Cho is now in second spot with a net worth of $8.5 billion, thanks to last year’s blistering 76% rally in the company’s shares, according to the Bloomberg Billionaires Index. Lee’s wealth has eroded after Samsung stock tumbled 32% last year and as the family faced billions of dollars in inheritance taxes. The 56-year-old Samsung heir is estimated to be worth $8.6 billion, a far cry from the $31.6 billion at his peak in January 2021. After Meritz shares gained another 17.8% this year, outpacing a 1.5% rise in Samsung, the gap between the two billionaires shrunk to about $100 million at the end of Wednesday’s trade, the narrowest it has ever been. Cho, 66, built his financial firm over decades into a local powerhouse with about $80 billion of assets under management. The company has insurance, securities and alternative investment management arms. Cho’s rise to South Korea’s uber rich list stands out in a country where inherited fortune largely defines wealthy. To be sure, Cho also hails from a business family. His father founded South Korea’s dominant transportation empire Hanjin Group in 1945, which includes Korean Air Lines Co., Hanjin Heavy Industries & Construction Holdings Co. among others. When the patriarch died in 2002, the crown jewels of the empire went to his three elder sons, while the youngest son Cho inherited “leftover” businesses, he told Forbes in 2015. Cho has ramped up the insurance business and expanded a holding company model, which has helped Meritz draw comparisons to Warren Buffett’s Berkshire Hathaway Inc. “Its nickname in the market is Merkshire Hathaway,” Choi Joon-Chul, co-chief executive officer at Seoul-based VIP Research & Management Inc., said, using a local portmanteau of Meritz and Berkshire. Choi’s fund has invested in Meritz since 2012. He said Cho has considered “talent as the core value in the finance industry” so he instilled a culture of meritocracy with strong rewards and fully entrusted his managers. A Meritz spokesperson offered no comment. Cho holds 51% of Meritz, which is a play on the word meritocracy. The company’s market value has surged more than 100 times since its initial public offering in 2011 to $16 billion. The shakeout playing out in South Korea’s wealth pecking order underscores the importance of corporate governance in unlocking value for shareholders. South Korea’s family-owned businesses have traded at a discount to their global peers due to lack of transparency and complex web of cross-holdings the founding families have used to maintain control. Cho’s bet on asset-light financial services sector with a simple structure has generated handsome return, with investors rewarding his efforts to improve transparency a
A finance tycoon is nearing the wealth of Samsung’s Lee, potentially becoming the richest individual in Korea.
