S.Korea builder HDC's chairman steps down after apartment complex collapse

HDC Holdings Co

17/01/2022 03:34

SEOUL, Jan 17 (Reuters) - The chairman of South Korean
construction firm HDC Hyundai Development Co  294870.KS  stepped
down from his role on Monday after outer wall structures of an
apartment complex it was building collapsed last week, with one
person found dead and five people still missing. 
    The collapse in Gwangju, South Korea on Jan. 11 was the
second serious incident within a year for HDC, one of the top 10
housing developers in South Korea. Nine people died and eight
were injured when a five-story building being demolished under
HDC's purview collapsed in June last year, also in Gwangju.
    Chung Mong-gyu, who is also chairman of parent HDC Holdings
Co Ltd  012630.KS  and a member of the larger family that
controls the Hyundai group of companies, said he is resigning
from the chairman role of the builder "with a deep sense of
responsibility for the two incidents in Gwangju". 
    "If there is an issue from the safety diagnosis conducted
with outside experts and the government, contract terminations
with apartment buyers, complete demolition and re-construction
can be considered," he told a televised press conference. 
    Chung's resignation comes before a new South Korean law
known as the Severe Accident Punishment Act takes effect near
the end of this month. 
    The law imposes criminal punishment of one or more years of
jail or fines up to 1 billion won ($838,434) for severe
industrial accidents on business owners and responsible
management if they violated a duty of safety measures stipulated
in the law, such as manpower and budget necessary to prevent
industrial accidents.
    Neither HDC nor Chung have been accused of wrongdoing. 
    "I am not considering shirking responsibility by resigning.
I will fulfil my responsibilities as a major shareholder," Chung
said. 
    Shares in HDC rose 2.7% after the resignation announcement
versus the wider market's  .KS11  1.1% drop. 
    
($1 = 1,192.7000 won)

 (Reporting by Joyce Lee; Editing by Kenneth Maxwell)
 ((joyce.lee@tr.com;))