(2nd LD) Education foundation withdraws bid to become top shareholder of Yonhap News TV

▲ The headquarters of Yonhap News Agency in central Seoul (Yonhap)

(2nd LD) broadcasting regulator-Yonhap News TV

(2nd LD) Education foundation withdraws bid to become top shareholder of Yonhap News TV

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SEOUL, Nov. 29 (Yonhap) -- Eulji Education Foundation on Wednesday withdrew its plan to become the largest shareholder of 24-hour cable news channel Yonhap News TV.

The announcement was made after the Korea Communications Commission (KCC) said it has put on hold its decision on Eulji's hostile takeover bid, as it needs to share its deliberation committee's opinion with the foundation and take necessary measures before reaching a decision.

The KCC's decision has widely been seen as a virtual veto against Eulji's plan. The foundation announced the withdrawal plan after the KCC's meeting.

Majority of the eight-member deliberation committee disapproved of Eulji's move, citing the lack of a detailed plan from the education foundation to fulfill the public duties of a news channel and fully separate Yonhap News TV from Yonhap News Agency, according to the regulator.

"The deliberation on the top shareholder status of the news channel was the most important deliberation and a decision since the KCC approved the launch of new TV channels in 2011," KCC Chairman Lee Dong-kwan said.

"We comprised the deliberation committee with personnel from the outside and conducted a fair review on the matter."

Earlier this month, the education foundation filed the request with the KCC to be recognized as the largest shareholder of Yonhap News TV in a bid to take control of the channel.

Yonhap News Agency, South Korea's key news wire agency, is currently the No. 1 shareholder of Yonhap News TV with a 29.89 percent share, slightly below the 30 percent cap stipulated by the Broadcasting Act.

Exploiting the loophole, Eulji has increased its share to 30.08 percent and was awaiting the KCC's approval.

Yonhap has accused Eulji of pushing for a hostile takeover of its TV affiliate, calling on the KCC to block the education foundation's move as it can "greatly damage" the business stability of broadcasting stations in the future.

Yonhap has also filed a complaint against Eulji Education Foundation Chairman Park Joon-young and his wife, Hong Sung-hee, the chair of Eulji Medical Center, on charges of breach of trust.

The two are accused of making the medical center donate its 600,000 shares in Yonhap News TV to Eulji Education Foundation in August in order to help the latter become the biggest shareholder of the TV channel.

Earlier Wednesday, civic group Spec Watch Korea also said it plans to file a complaint against Park and his wife over the allegations.

Meanwhile, the main opposition Democratic Party has been pushing for KCC Chairman Lee's impeachment, accusing him of unfair personnel decisions and appointments aimed at increasing government influence over broadcasting stations.

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