The Daewoo Group reached its peak as the second-largest conglomerate in South Korea before collapsing in 1999 under 50 billion US dollars in debt. Founder Kim Woo-choong built this sprawling industrial empire from a modest textiles trading firm, eventually controlling interests in approximately 100 countries until the Asian Financial Crisis triggered its rapid dissolution.
Early Career and Education
Born in Daegu in 1936, Kim experienced significant personal upheaval as a teenager when his father, a provincial governor, was taken to North Korea. During his youth, Kim worked as a newspaper delivery boy to support himself. He later attended Kyunggi High School and earned a Bachelor of Economics from Yonsei University in Seoul. His early professional connections included links to South Korean president Park Chung Hee, who had been mentored by Kim's father.
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In 1967, Kim established a textiles trading corporation alongside five associates. He rapidly grew the organization, which became the Daewoo Group, by aggressively acquiring near-bankrupt companies using borrowed capital. This strategy succeeded throughout the 1980s, establishing Daewoo as the third-largest chaebol in the nation. By the 1990s, the group ranked second in assets and third in annual revenues.
Financial Collapse and Legal Consequences
The 1997 Asian Financial Crisis exposed structural weaknesses within the group, forcing the sale of nearly 50 subsidiaries. Following the 1999 bankruptcy, Kim fled to Vietnam to avoid legal scrutiny. Authorities pursued him for accounting fraud totaling 41 trillion won, illegal borrowing of 9.8 trillion won, and the laundering of 3.2 billion US dollars. He eventually returned to South Korea on 14 June 2005 and was taken into custody.
Sentencing and Final Years
A court convicted Kim of embezzlement and accounting fraud in May 2006, issuing a 10-year prison sentence and ordering the seizure of 21 trillion won from his personal fortune. His term was later reduced to eight and a half years citing health issues. On 30 December 2007, President Roh Moo-hyun granted him a pardon. Kim died of pneumonia at Ajou University Hospital in Suwon on 9 December 2019.
Fast facts
- Born: 1936, Daegu
- Died: 9 December 2019, Suwon
- Citizenship: South Korea, France
- Education: Kyunggi High School, Yonsei University
- Major affiliation: Daewoo Group
- Award: Commander of the Legion of Honour (1996)
- Final career status: Convicted of accounting fraud
- Cause of death: Pneumonia
Questions readers ask
What was the scale of the Daewoo Group collapse?
At its bankruptcy in 1999, the conglomerate held debts of approximately 50 billion US dollars.
Why was Kim Woo-choong arrested?
He was charged with accounting fraud, illegal borrowing, and money laundering following the collapse of his business empire.
Achievements
- Commander of the Legion of Honour — 1996
- Affiliated with Daewoo
- Educated at Yonsei University and Kyunggi High School
