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Nexen Group Vice Chairman Kang Ho-chan Sells Stake in OTP Manufacturer OTP Multi Solution

[비즈한국] It has been confirmed that Nexen Group Vice Chairman Kang Ho-chan has sold his stake in OTP Multi Solution, an OTP (One Time Password) manufacturing company. Vice Chairman Kang had personally managed the company as its largest shareholder and CEO. However, he recently sold his stake and stepped down as CEO. He is expected to focus on the management of Nexen Tire002350 moving forward. Vice Chairman Kang currently serves as the CEO of Nexen Tire. Nexen Tire’s earnings outlook is currently clouded by U.S. tariff policies.

OTP Multi Solution is a company that produces and supplies OTP (One Time Password) generators to major domestic financial institutions. OTP is a user authentication method that uses randomly generated temporary passwords instead of fixed passwords. It is primarily used for electronic financial transactions, such as online banking.

OTP Multi Solution did not have a major presence in the IT industry, as the domestic OTP market is dominated by Mirae Technology. Nevertheless, the company garnered attention because Nexen Group Vice Chairman Kang Ho-chan was its largest shareholder.

Nexen Tire, a Nexen Group affiliate, is one of the most prominent companies in the tire industry. However, Nexen Group has not had any significant business operations in the IT sector. Furthermore, OTP is not a business that typically creates synergy with tires.

Vice Chairman Kang took office as CEO of OTP Multi Solution in 2012 and directly oversaw its management. Separate from Nexen Group, Vice Chairman Kang held the stake and managed the company as an individual. No Nexen Group affiliates held shares in OTP Multi Solution. Nexen Group did not disclose the specific size of Vice Chairman Kang’s stake in the company.

The specific earnings and financial status of OTP Multi Solution have not been disclosed. Under current law, companies are subject to external audits if they meet two or more of the following criteria: △assets of 12 billion won or more, △liabilities of 7 billion won or more, △sales of 10 billion won or more, or △100 employees or more. OTP Multi Solution is not subject to audit requirements as it does not meet these criteria, which indicates that the company is not large in scale.

BizHankook's investigation confirmed that Vice Chairman Kang Ho-chan recently sold his stake in OTP Multi Solution. He also resigned as the company’s CEO this past March. Nexen Group stated that it was difficult to verify information regarding OTP Multi Solution. An official from Nexen Corp., the holding company of Nexen Group, said, "There is currently no one responsible for media relations." An official from Nexen Tire, a key Nexen Group affiliate, also stated, "We are not aware of the details."

Having sold his stake in OTP Multi Solution, Vice Chairman Kang Ho-chan is expected to focus on Nexen Tire’s management for the time being. The outlook for the domestic tire industry is dim due to the tariff policies of U.S. President Donald Trump. Since May, President Trump has begun imposing a 25% tariff on imported automotive parts. However, a partial two-year tariff exemption has been granted for some parts used in vehicles produced in the U.S., such as tires.

Hankook Tire & Technology161390 and Kumho Tire073240 operate manufacturing plants in the U.S. Specifically, Hankook Tire & Technology is currently expanding its Tennessee plant. Nexen Tire, however, does not have a factory in the U.S., meaning it will be hit directly by U.S. tariff policies. Even if construction on a U.S. plant were to begin this year, it would be difficult to complete within the two-year grace period. Nexen Tire earns a significant portion of its revenue from the North American market. In the first quarter of this year, 181.3 billion won—approximately 23.51% of its total revenue of 771.2 billion won—was generated in North America.

Shin Yoon-cheol, an analyst at Kiwoom Securities, analyzed, "We are lowering our target stock price for Nexen Tire from 9,000 won to 8,000 won, reflecting a downward adjustment of earnings estimates primarily for the second half of the year due to U.S. tariffs," adding, "As the U.S. imposes import tariffs, it will act as a burden on Nexen Tire, which lacks a local production base."

Nexen Tire has not made any specific comments regarding the possibility of building a U.S. plant. In its investor relations materials, the company stated, "We plan to respond cautiously by reflecting the recurring flow of tariff impositions and exemptions, as well as the potential for negotiations by country," adding, "We will optimize volume distribution by region and consider price adjustments."