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Kim Jun-ki, Chairman of DB Group. (Photo courtesy of Yonhap News Agency) |
[Alpha Biz= Kim Jisun] Antitrust complaint against Chairman Kim Jun-ki casts shadow over government-backed investment support
Plans by DB HiTek to secure large-scale policy funding for a next-generation semiconductor facility have been thrown into uncertainty after Kim Jun-ki, chairman of DB Group, was referred to prosecutors over allegations of operating disguised affiliates.
DB HiTek had sought financial support through the government-backed National Growth Fund to finance its next-generation power semiconductor business. The company aims to expand its 200-mm (8-inch) wafer-based foundry line in Eumseong, North Chungcheong Province, to build advanced power semiconductor infrastructure.
Under the plan, DB HiTek would increase its monthly 8-inch wafer production capacity by more than 20%, from about 154,000 wafers to roughly 190,000 wafers. The total investment required is estimated at KRW 1.5 trillion, a level the company is widely seen as difficult to finance independently—prompting its request for policy funding.
The expansion is intended to capitalize on rising demand for power semiconductors driven by the spread of artificial intelligence. Last year, DB HiTek posted revenue of KRW 1.3972 trillion and operating profit of KRW 277.3 billion, up 45% year-on-year. Despite solid earnings, analysts note that the scale of planned capital expenditures exceeds what the company can comfortably fund on its own, potentially limiting its ability to expand beyond mobile and consumer electronics into AI data centers, robotics, and automotive applications.
Expectations for policy funding had risen after Deputy Prime Minister and Finance Minister Koo Yun-cheol visited DB HiTek’s Eumseong plant last month and expressed support for investment financing.
However, sentiment within the government has reportedly shifted following the Fair Trade Commission’s decision to file a criminal complaint against Chairman Kim. Investigators concluded that Kim allegedly used foundation-controlled companies he dominated as tools to defend management control and channel funds to the controlling family.
Authorities also flagged past transactions in which foundation entities purchased DB HiTek real estate to support the company during periods of financial difficulty. As a result, some policymakers now argue that extending public funds to a company with governance concerns could be inappropriate.
With the case drawing heightened scrutiny, DB HiTek’s efforts to secure policy-backed financing for its semiconductor expansion are expected to face increased uncertainty.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
