Samsung faces shake-up after chairman's death
South Korean conglomerate Samsung could be “shaken up” after the death of chairman Lee Kun-hee last week.
South Korean conglomerate Samsung could be “shaken up” after the death of chairman Lee Kun-hee (pictured) last week, says the BBC. Shares in several Samsung businesses have jumped amid reports that his heirs could be “forced into asset sales or dividend payments” in order to pay a “massive” inheritance tax bill.
A large tax bill isn’t the only problem that Samsung faces, says Elizabeth Koh and Jonathan Cheng in The Wall Street Journal. While Lee transformed a “second-tier electronic-parts maker into the world’s biggest manufacturer of smartphones and televisions”, the company has faced a “string of scandals and business challenges” in recent years. In particular, Lee’s attempt to pass his empire to his son, vice chairman Lee Jae-yong, who is widely expected to succeed his father as chairman, sparked continuing legal cases into “alleged bribery and financial fraud” that could see Jae-yong imprisoned. Samsung is also battling “slowing momentum” in mobile phones”.
But don’t underestimate Jae-yong or Samsung, says The Economist. Since the younger Lee effectively took over control in 2014, Samsung has defended its position in mobile devices against competition from China while also forging global partnerships, including with Apple – a Samsung subsidiary supplies the screens used in iPhones. Jae-yong is also moving the company away from producing “solid but unsexy hardware” towards an “emphasis on design and software” – the same strategy that has won American tech firms “trillion-dollar valuations”.