Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Korea Stock Exchange  >  Samsung Electronics Co., Ltd.    A005930   KR7005930003

SAMSUNG ELECTRONICS CO., LTD.

(A005930)
  Report
SummaryChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Five things to know about Samsung Electronics' holding company review

11/29/2016 | 04:36am EST

SEOUL (Reuters) - Tech giant Samsung Electronics Co Ltd (>> Samsung Electronics Co Ltd) said on Tuesday it is considering whether to create a holding company as part of a corporate restructuring review.

SEOUL (Reuters) - Tech giant Samsung Electronics Co Ltd (>> Samsung Electronics Co Ltd) said on Tuesday it is considering whether to create a holding company as part of a corporate restructuring review.

Following are some details on the deliberations and implications of any change implemented:

* What is a holding company?

A holding company is one that owns other companies' stock. Holding companies typically do not run their own businesses and are used to control various affiliates or subsidiaries.

South Korea's government is pushing local conglomerates to gradually move to a holding company structure to improve transparency and corporate governance.

Some of the country's biggest conglomerates such as LG Group have established a holding company in order to streamline their ownership structure.

* Why would Samsung Electronics consider such a move?

Investors and analysts have long suspected that Samsung Electronics will move to split itself into an ownership company and an operating company as part of a complicated set of steps to boost Jay Y. Lee and other Samsung Group founding Lee family heirs' control of the conglomerate's top company.

While Samsung did not comment on how it might transition to a holding company structure, analysts say Samsung could engineer a split in a way that existing shareholders are left with shares in both the ownership company and the operating company.

Samsung's holding company then can offer its own shares to investors in exchange for shares in the operating company. This would boost the ownership company's stake in the operating company while providing a way for the Lee family and other Samsung Group affiliates to raise their stake in the ownership company.

* Why now?

U.S. activist hedge fund Elliott Management, which owns 0.6 percent of Samsung, in October proposed that Samsung be split in two as part of a wide-ranging set of proposals the fund says will boost shareholder value.

Samsung said last month it would respond to Elliott's proposals by the end of November.

* How would such a restructuring benefit investors?

Elliott has argued such a move would help streamline Samsung Group's complicated ownership structure and improve transparency, thus improving valuation of Samsung.

Some investors say Samsung Electronics may boost payouts once the Lees and other Samsung affiliates have bolstered their ownership of the company. Jay Y. Lee and his two sisters face a multi-billion dollar inheritance tax burden in the event their father and Samsung Group patriarch, 74-year-old Lee Kun-hee, passes away. The elder Lee remains incapacitated following a May 2014 heart attack.

Increased payouts following a restructuring would also benefit Samsung's other investors.

* What are the potential obstacles?

Samsung Electronics executives said on Tuesday they need to consider various potential implications of moving to a holding company structure, such as potential changes in how the company would be taxed and other regulatory requirements.

South Korean laws also mandate a holding company must own at least 30 percent of its publicly traded affiliates. Samsung Electronics would need to buy additional shares in companies such as Samsung SDI Co Ltd (>> Samsung SDI Co Ltd), Samsung Electro-Mechanics Co Ltd (>> Samsung Electro-Mechanics Co., Ltd.) and Samsung SDS Co Ltd (>> Samsung SDS Co Ltd) to meet such requirements, which could cost it billions of dollars.

(Reporting by Se Young Lee; Editing by Muralikumar Anantharaman)


© Reuters 2016
Stocks mentioned in the article
ChangeLast1st jan.
CHANGE INC. 8.49% 3770 End-of-day quote.6.95%
E.ON SE -1.10% 8.786 Delayed Quote.-1.99%
SAMSUNG ELECTRO-MECHANICS CO., LTD. 0.94% 214500 End-of-day quote.20.51%
SAMSUNG ELECTRONICS CO., LTD. 3.00% 89400 End-of-day quote.10.37%
SAMSUNG SDI CO., LTD. -0.25% 790000 End-of-day quote.25.80%
SAMSUNG SDS CO.,LTD. 2.72% 207500 End-of-day quote.16.25%
All news about SAMSUNG ELECTRONICS CO., LTD.
10:18aSAMSUNG ELECTRONICS : Chinese smartphone brands expanded India market share in 2..
RE
04:53aMARKET CHATTER : Samsung Biologics' Net Profit Rises 19% in 2020 on Higher Sales..
MT
04:50aSeoul Stocks Close in the Red on Massive Foreign Selloff Ahead of US Federal ..
MT
01/26MARKET CHATTER : Samsung Group Heir, Prosecution Will Not Appeal High Court Verd..
MT
01/26Seoul Stocks Tumble on Foreign, Institutional Investors’ Profit-Taking,..
MT
01/26SAMSUNG ELECTRONICS : Expands Vital Blood Pressure and Electrocardiogram Trackin..
PU
01/26S.Korea shares drop on liquidity fears in China, U.S. stimulus worries
RE
01/25South Korea Q4 GDP beats expectations, poised for strong 2021 rebound
RE
01/25Nasdaq, S&P 500 Finish at Records -- Update
DJ
01/25Nasdaq, S&P 500 Finish at Records
DJ
More news
Financials
Sales 2020 236 418 B 214 B 214 B
Net income 2020 26 683 B 24,1 B 24,1 B
Net cash 2020 93 685 B 84,8 B 84,8 B
P/E ratio 2020 21,2x
Yield 2020 2,01%
Capitalization 574 623 B 519 B 520 B
EV / Sales 2020 2,03x
EV / Sales 2021 1,78x
Nbr of Employees -
Free-Float 82,9%
Chart SAMSUNG ELECTRONICS CO., LTD.
Duration : Period :
Samsung Electronics Co., Ltd. Technical Analysis Chart | A005930 | KR7005930003 | MarketScreener
Technical analysis trends SAMSUNG ELECTRONICS CO., LTD.
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 39
Average target price 98 684,21 KRW
Last Close Price 85 600,00 KRW
Spread / Highest target 47,2%
Spread / Average Target 15,3%
Spread / Lowest Target -28,7%
EPS Revisions
Managers and Directors
NameTitle
Hyun-Suk Kim Co-President, Co-CEO & Director
Dongjin Koh Co-President, Co-CEO & Director
Kinam Kim President, Co-CEO & Director
Tae Moon Roh Co-President & Head-Research & Development
Jae-Wan Park Chairman
Sector and Competitors
1st jan.Capitalization (M$)
SAMSUNG ELECTRONICS CO., LTD.10.37%527 404
APPLE INC.7.71%2 408 418
XIAOMI CORPORATION-7.98%98 689
WINGTECH TECHNOLOGY CO.,LTD18.00%22 499
MERRY ELECTRONICS CO., LTD.-6.48%1 012
FOCUSRITE PLC-1.40%843