The board of Samsung Electronics said it had hired advisers to review the question of whether to split into a holding company for ownership purposes and an operating company. Activist investor Elliott Management has called for the split in order to increase shareholder returns.
A
Fortune
report said
the move has been “long expected as the next succession step for the founding Lee family's heirs.”
Samsung said in a statement, “The review does not indicate the management or the board's intention one way or another,” and added that the review would take at least six months, the
Fortune
article said.
A split would strengthen the Lee family's control over the Samsung Group. Investors believe the family and Samsung Group affiliates would exchange their operating company shares for stock in the holding company, the report said.
“Samsung Electronics would then return more capital to shareholders, investors say. Such a move would boost earnings for Samsung Group firms and the Lee heirs, who face a multi-billion dollar inheritance tax in the event that 74-year-old Samsung Group patriarch Lee Kun-hee passes away. The senior Lee has been in hospital since May 2014 after suffering a heart attack,” the article said. (Source:
Fortune
, Nov. 28, 2016.)
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