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First Lady Kim Keon-hee’s company ‘Covana’ emerges in lawsuit related to ‘Yangpyeong Gongheung District Development Project’

[비즈한국] Bizhankook has uncovered evidence linking Covana Co., Ltd., a company previously operated by First Lady Kim Keon-hee, to the development project in the Gongheung District of Yangpyeong, Gyeonggi Province. It has been confirmed that a Busan-based company, Company A, filed a lawsuit after failing to receive profits from an investment it made in the Gongheung development project—a project involving the First Lady’s mother, surnamed Choi—and subsequently placed a provisional seizure on Choi’s shares in Covana in relation to this litigation.

In December, Bizhankook reported that Choi, the mother-in-law of President Yoon Suk Yeol and mother of First Lady Kim Keon-hee, had been sued by Company A from Busan for failing to pay out investment profits after receiving funds for the Gongheung District development project (Related article: [Exclusive] Representative of investment firm housed in Covana office, a ‘curious connection’ with the President’s mother-in-law). Now, it has emerged that the First Lady’s company, Covana, is also linked to the Gongheung District project through the legal proceedings of that very lawsuit.

In June 2015, Company A, based in Busan, applied for a provisional seizure of the Covana shares owned by Choi. After failing to receive profits from the 800 million won invested in the Gongheung development project, the company filed a lawsuit, but requested the provisional seizure of shares prior to the filing. At the time, the only asset of Choi’s that Company A petitioned the court to seize was 10,000 shares of Covana (valued at 5,000 won per share, totaling 50 million won). The court ruling approving the provisional seizure specified that Company A held a claim against Choi totaling 185,031,360 won, and explicitly named Covana as the third-party debtor.

The fact that the company targeted specifically Covana shares—rather than the family company ESI&D, which was directly involved in the development, or Choi’s personal assets—suggests that Covana has a connection to the Gongheung project. While the provisional seizure of the Covana shares was approved by the court in July 2015, it was lifted in February 2016 because Company A failed to submit the necessary documents to the court on time. Until now, it was only known that the family company ESI&D was involved in the Yangpyeong Gongheung project, making this the first time evidence has emerged linking Covana to the project.

Covana is known as a company established by First Lady Kim Keon-hee to plan art exhibitions. According to a corporate credit report for Covana from June 2016 obtained by Bizhankook, Kim was a co-CEO at the time, but all of the company’s shares were held by her mother, Choi. Kim and Choi served as co-CEOs of Covana from December 2012 to December 2015, after which Kim Keon-hee served as the sole CEO until May 2022. Currently, the First Lady’s older brother is confirmed as the company’s sole internal director.

The verdict in the lawsuit involving Company A also reveals details of First Lady Kim Keon-hee’s involvement in the Gongheung District project. The judgment obtained by Bizhankook states that Kim encouraged the son of Company A’s CEO to invest in the project. The ruling reads: “As Kim Keon-hee, the daughter of the defendant (mother-in-law Choi), encouraged C, the son of the plaintiff’s (Busan Company A) CEO B, to invest in the project in May 2009, the plaintiff entered into an investment agreement with the defendant on July 15, 2009. The agreement stipulated that if the plaintiff invested 800 million won in the project, the defendant would pay the plaintiff a portion of the profits generated from said project.”