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Conglomerates' subsidiaries soar some 50 pct in 5 years

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(GlobalPost/GlobalPost)

SEOUL, Oct. 6 (Yonhap) -- The number of companies belonging to the nation's leading family-controlled conglomerates, known as chaebol, has jumped nearly 50 percent over the past five years, industry data showed Sunday.

The nation's top 30 family-owned conglomerates had a combined 1,246 subsidiaries as of the end of last year, up 47.8 percent from the 843 reported at the end of 2007, according to the data by Chaebol.com.

The number of chaebol subsidiaries, however, edged down this year, with the figure reaching 1,237 as of the end of September, said Chaebol.com, which tracks the conglomerates.

Over the past five years, Lotte Group posted the largest increase in the number of subsidiaries with 36, followed by Dongbu Group with 33. LS and LG groups came next with 28 companies each.

Kumho Asiana Group, whose flagship is the country's second-largest carrier Asiana Airlines, was the only conglomerate that saw a decline, with the number dropping to 20 at the end of last year from 35 five years earlier.

As of the end of September this year, SK Group, the nation's No. 3 conglomerate, had 83 subsidiaries, up from 65 five years ago.

Top conglomerate Samsung Group had a total of 77 subsidiaries, up from 59 five years earlier, with the number for No. 2 Hyundai Motor Group soaring to 57 from 36 over the cited period, according to the data.

Chaebol.com attributed the surge in the number of conglomerates' subsidiaries to their aggressive business expansion through mergers and acquisitions.

Experts warned that excessive expansion through mergers and acquisitions, seen as a major means of their growth, could throw highly leveraged conglomerates into a liquidity crisis and an eventual collapse if things went awry.

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