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The Man Behind Korea’s Silicone Giant

Posted April. 27, 2006 03:10,   


Chung Sang-young, the 70-year-old honorary chairman of the KCC Group, is recently visiting the Central Research Center in Yongin, Gyeonggi Province more often.

He is doing it to encourage research teams related to the silicone business on which he is focusing as a future business.

On April 25 when your reporter visited the research center, Chung was there. He is so focused on the silicone business that he even says that “KCC’s future hinges on it.”

Lee Won-ho, a managing director of the research center who generally manages the silicone business there, said, “The honorary chairman appears to consider the silicone business as the last business of his life.”

“Silicone Will Feed KCC”-

The honorary chairman is the youngest sibling of Chung Joo-young, the late founder of the Hyundai Group.

Among six brothers and two sisters of the first generation of Hyundai’s founding family, only three are alive: Halla Group Honorary Chairman Chung In-young (86), Chung Sang-young, and Chung Hee-young (81). In particular, Chung Sang-young is the only one who is still engaged in management among the siblings.

Although Chung Mong-jin, Chung Sang-young’s first son and the chairman of KCC, and Chung Mong-ik, the second son and the president of the company, are managing the company, the honorary chairman still sets the direction of management.

The honorary chairman set up “Keumkang Slate Industry,” the predecessor of the KCC Group in 1958 in Seoul with seven employees, despite his elder brother Chung Joo-young’s advice to go abroad to study. The company has grown into a sound firm that posts 2.897 trillion won in sales and 283.6 billion won in net profits.

The company is the leader in the paint and the construction material industries, but the honorary chairman is confident that the versatile silicon business will support KCC in the years to come.

“Oil extracted from stone”-

Silicone, which is made from the process of combining carbon and silicon extracted from sand, is called the “oil extracted from stone.” It is a state-of-the-art material hailed as the greatest resource that can replace oil in an era of oil price hikes.

The material is used everywhere, not only in aerospace, munitions, automobiles and semiconductor industries, but also cosmetics, remote controls and computer keypads. There are as many as 4,000 kinds of products that can be made with silicone.

However, only a handful of companies in the world have the technology to produce in bulk the raw materials of silicone.

Major silicone companies are the U.S.-based Dow Corning and GE, Shinetsu in Japan and Wacker in Germany. KCC is unique in Korea for the ability to produce the raw materials of silicone.

After successfully developing the technology on its own after 10 years of research, KCC is producing three million tons of silicone raw materials every year in its plant established in 2004 in Jeonju, Jeonbuk Province.

But the honorary chairman is planning to invest one trillion won in expanding plants, including investing 300 billion won this year to construct a plant that can produce 60,000 tons of silicone annually in the Daejuk Local Industrial Complex in Chungnam. He aspires to transform the company into one of the world’s top four silicone companies by increasing the annual capacity to 200,000 tons by 2012.

It plans to expand silicone plants with funds recently secured: 130 billion won from selling Hyundai Elevator shares.

KCC Chairman Chung Mong-jin said in an interview yesterday, “Under my father’s instruction to learn technologies, I remember touring silicone factories in Russia, China and Ukraine for months. I’ve made considerable efforts to learn the silicone business.”

Sang-Soo Kim ssoo@donga.com