Shareholders approve Samsung deal paving way for succession

It was only a slim margin that allowed Lee Jae to score a win over the American hedge fund company.

“Samsung and the Lee family have always been engaged in a decade-plus of maneuvering with a simple goal of transferring share ownership and control over various Samsung Group companies to the next-generation Lee family”, Bernstein analysts wrote in a research note.

But Lee, 47, is a major shareholder in Cheil thanks to shares he was effectively gifted before the company went public.

New York hedge fund Elliott Management, run by billionaire activist investor Paul Singer, thinks the merger of the two subsidiaries is bad for shareholders, arguing the sweetheart deal to Samsung’s founding family (which owns large stakes in the subsidiaries) doesn’t benefit the rest of its stockholders.

In a sign it may be readying a protracted legal battle, Elliott has bought 1% stakes in Samsung SDI Co and Samsung Fire & Marine Insurance Co, both of which own C&T shares. The fund could also use its 7 per cent stake in C&T, plus holdings in other Samsung companies, to call for management changes or press for higher payout ratios.

SEOUL, South Korea – Shareholders approved a highly contested deal that strengthens the Samsung family’s grip on the world’s largest smartphone maker. Samsung SDS shares gained another 1% on Friday after rising 9.4% on Thursday. “It’s too unfair”, an elderly shareholder told the meeting before the vote. “This is an embarrassment to the Republic of Korea”.

SAMSUNG VOTE: South Korean markets were awaiting the outcome of a vote by shareholders on combining two companies in the vast Samsung empire. In the days leading up to the vote, Samsung C&T took out television and front-page newspaper ads asking shareholders to vote for the takeover.

“While the deal will boost Samsung’s restructuring, Samsung lost the faith of a lot of foreign and minority shareholders”, said Kang Dong-oh, a proxy representative for an online forum of minority shareholders against the merger.

“The blatant Jew hatred cartoons invoking genocidal stereotypes is outrageous and makes a mockery of earlier statement by Samsung”, said SWC Associate Dean Rabbi Abraham Cooper, in an email seen by The Algemeiner.

“Samsung’s reputation will be bruised for a while”, Mr. Ryu said.

According to local media, Lee Eui Chun, the former CEO of the business blog, who held the position as recently as two months ago, is now a deputy minister in the government.

“The winning will surely help Lee Jae Yong to take one step closer to the eventual handover of power”, said Lee Jisoo, an attorney at Law & Business Research Center.

“Some investors may opt out at this point as many apparently have, and longer-term investors who really believe in this merger will stay put”, Lee added.

“The shareholders’ meeting today will mark another beginning for him”. Kim is a professor at Hansung University and director of Solidarity for Economic Reform.