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Samsung asks media to refrain from speculative reporting amid merger probe

Economy 12:29 June 07, 2020

SEOUL, June 7 (Yonhap) -- Samsung Group on Sunday asked the media to refrain from publishing speculative reports related to the prosecution's investigation of a controversial merger of two affiliates.

"Speculative or unconfirmed reports with questionable sources are continuing to come out as of late. Of those, some stories are based on the impression of guilt," the group said in a statement released through the communication team of Samsung Electronics Co.

Samsung commented that "(speculative) reports raise concerns of the distorting decisions by the judiciary" and asked the media to refrain from making unfair or groundless reports.

The appeal was made as the prosecutors were intensifying their investigation into the merger of Samsung C&T Corp. and Cheil Industries Inc. in 2015, specifically on whether Lee Jae-yong, the Samsung Group heir, was involved in a scheme to intentionally lower the value of Samsung C&T to facilitate his succession from his ailing father, Lee Kun-hee.

Prosecutors have also been looking into suspected window dressing by Samsung Biologics, a subsidiary of Cheil Industries in 2015.

On Thursday, prosecutors sought an arrest warrant for Lee. A Seoul court will hold a hearing Monday to decide whether to issue the arrest warrant. If the warrant is approved, it will be the first time since 2017 that Lee will be arrested on criminal charges.

Lee has asked the prosecution to have its outside experts review the ongoing probe and determine the validity of a potenial indictment.

Samsung said it will respect the decision made by the court and from the review of outside experts on Lee's indictment regardless of what conclusion the prosecution reaches.

The group also reiterated that the merger in question was handled in accordance with the law. It also stressed that accounting of Samsung Biologics was done in accordance with international accounting standards.

The group said its latest statement was aimed at helping the court and the review board make an "objective and rational judgment."

Samsung also stated it was facing unprecedented business woes over the prosecution's investigation, the COVID-19 situation and from worsening business conditions caused by the trade war between the United States and China.

"It is regretful that we have raised concerns due to our management crisis at a time when Samsung should be the leader in overcoming the economic crisis stemmed from the prolonged COVID-19 situation," Samsung said.

The group further asked the media to help the company "so that Samsung can take on the role in overcoming South Korea's economic crisis."

This file photo, dated May 6, 2020, shows Samsung Electronics Co. Vice Chairman Lee Jae-yong, the heir of Samsung Group, attending a press conference at the company's office building in Seoul to make a rare public apology over controversies related to his succession. Prosecutors sought an arrest warrant for Lee on June 4, 2020, as part of an investigation into a controversial merger between two Samsung units. (Yonhap)


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