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Day 100 of Samsung Affiliates Standing Alone

15:48 June 09, 2017 replay time01:53

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It has been 100 days since Samsung Group took down its Future Strategy Division sign from its control tower and began self-regulated competition amongst its affiliates.

Though from the outside there seems to be no problem, there is considerable difficulty for pursuing large M&As and new businesses.

Kim Jong-sung has more.


February 28.

Samsung Group dissembled its control tower, the Future Strategy Division, and commenced self-regulated competition amongst its 59 affiliates.

Though the conversion of Samsung's holding company was suspended and Samsung Heavy Industries was hurt due to the accident at the Geoje Shipyard crane, other affiliates seem to be concentrating on their businesses without much trouble under the leadership of their respective executive boards.

Notably, the stock price of Samsung Electronics, the key affiliate of the Samsung Group, which at the time of the dissembling of the Future Strategy Division was 1.92 million won, surprisingly was recorded at 2.351 million won early last month.

Samsung Electronics is continuing with its investments as well. It recently invested 860 billion won in the India factory construction project, and 330 billion won to propel construction of a home electronics factory in the U.S.

But a closer look at its management reveals Samsung's predicaments. There were no noteworthy M&As since Harman.

Senior officials of Samsung have revealed, "There is no problem right at this moment in running the affiliates thanks to the management experts, but it is true that we have not been able to deal with big issues since the arrest of Vice President Lee Jae-yong and the dissembling of the Future Strategy Division very efficiently."

This means that the affiliates are engaging in minimum investment for defensive purposes, but they are passive in regards to M&As to find resources for the future and to advance into new businesses.

They explain the same goes for the fact that they still were not able to proceed with personnel matters of the president that have been postponed since last year.

The financial industry predicts that though Samsung's situation is as of yet being understood as a "crisis without substance," Samsung too will go through a depression as with CJ's "Lost 3 Years" following the arrest of Lee Jae-hyun.

Kim Jong-sung reporting for Yonhap News TV.

Yonhap News TV: 02-398-4441 (Inquiry on article) 4409 (Report), KakaoTalk/LINE jebo23

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