The head of the company that operated South Korea’s ill-fated ferry, which capsized killing more than 300 people, most of them high school students, has been sentenced to 10 years in prison.

A court in the southern city of Gwangju on Thursday determined that Kim Han-sik, chief executive of Chonghaejin Marine Co, had allowed the ferry to be routinely overloaded and approved illegal renovations to increase its passenger capacity.

• S Korea ferry captain jailed for 36 years

The 6825-tonne Sewol was carrying 476 people when the overloaded, ill-balanced ship commanded by what the court termed as an “incompetent” crew capsized off the southern coast on April 16.

Kim, 71, who was convicted of manslaughter, was also found guilty of allowing the ship’s cargo to be left unsecured in breach of safety standards.

Ten other defendants, including six from Chonghaejin Marine, stood trial with Kim.

One was acquitted and nine were given sentences ranging from suspended jail terms to six years in prison.

Kim had repeatedly denied responsibility, insisting he was a salaried employee under the thumb of company owner Yoo Byung-eun, whom he described as being deeply involved in the hands-on operations of the firm.

Kim was also convicted of diverting $US2.6 million ($A2.81 million) from Chonghaejin Marine over the past four years and funnelling it to Yoo, Yoo’s other companies and Yoo’s family members.

Following the disaster, Yoo became the target of a massive manhunt.

His badly decomposed body was found in a field in June, but an autopsy failed to determine the cause of death.

Yoo’s eldest son, Yoo Dae-kyun, was jailed for three years earlier this month for embezzlement, while his widow is still awaiting sentencing on the same charge.

The Sewol’s captain, Lee Jun-seok, was jailed for 36 years last week, convicted of gross negligence and dereliction of duty, including abandoning his vessel while hundreds of passengers remained trapped on board.

Lee’s defence lawyer had argued that Chonghaejin Marine bore the most responsibility, as it had ordered the illegal refit and determined the amount of cargo the vessel carried.