Samsung Electronics Co Ltd said on Tuesday it has no plans at present to consider a merger between a holding company and Samsung C&T Corp in its ongoing structural review.
US activist hedge fund Elliott Management in October called for the world’s top smartphone maker to split itself into a vehicle for ownership and an operating company, then merge the ownership company with Samsung C&T.
The hedge fund wants Samsung Electronics to divide into a holding vehicle for ownership purposes and an operating company, pay a $26 billion special dividend, pledge to return at least 75% of free cash flow to investors and agree to appoint some independent directors.
Neither the Lee family nor Samsung Group have commented on restructuring plans, but the conglomerate’s reorganization efforts have accelerated since Jay Y. Lee took over the reins after his father and Samsung patriarch Lee Kun-hee was incapacitated following a May 2014 heart attack.
Samsung has sold non-core assets while pushing through a merger of two affiliates in 2015 to consolidate stakes in key affiliates under a company controlled by Jay Y Lee and his two sisters, as the founding family moves to secure a stable transfer of control.
“Even if Samsung Electronics does not comment on specifics such as the timing of a split… the firm will at least say it will implement ownership structure changes in a reasonable manner,” HI Investment said in a report on Monday.
8 ways Samsung killing Galaxy Note 7 will change the smartphone industry
It’s official, Samsung’s latest phablet Galaxy Note 7 has been scrapped for good. The South Korean giant has officially pulled the plug on Galaxy Note 7 on smartphones, permanently ceasing production just weeks after the device went on sale.
The company’s unprecedented decision comes after spate of smartphone battery fires, somereported even in replacement devices. The company had initially got rave reviews for its latest flagship after reports started trickling in about the smartphone getting overheated and exploding.
Here are ways how Samsung’s Galaxy Note 7 fiasco will hurt the smartphone industry globally.