The South Korean tech giant, Samsung, announced today that it is merchandising its stakes in about 4 chemical and defense arms for $1.72 billion. Apparently, the company will be selling this stake to Hanwha Group. This comes as the latest move as the corporate giant engages in defiant maneuvers to re-assert its profitability, after recent drops in profit figures.
Samsung is the world’s largest smartphones manufacturer. Reports indicate that the restructuring is geared to make the company easier to manage to its heirs, who are the children of the company’s chairman, Mr. Lee Kun-hee. Mr Kun-hee is currently 72 years old. He has been in hospital since a heart attack affected him on May. The aim is to narrow down the group’s focus.
Mr. Kun-hee’s children, who are the conglomerate’s heirs, are also preparing to part ways with a 6 trillion won inheritance tax bill. Experts argue that the listing of Samsung SDS Co, and the soon-to-come IPO of Cheil Industries Inc, will make the entire transition easier and more convenient to reign on.
Under the leadership of Kun-Hee, Samsung greatly expanded its scope, investing in new sectors and producing a wide range of consumer electronics products. But now, it looks like the apparent heir, Mr. Jay Y. Lee, is going the other direction. He has been making efforts of late to make the tech giant more compact, with a narrower scope that has been usual.
These developments come just a few days after the company announced a major management reshuffle, which will see the top three spots in the company’s administrative spheres shaken. Samsung has been facing intense competition from emerging Chinese brands, including Xiaomi, which manufactures comparable smartphones and sells them at a much lesser price tag. Samsung has thus been taking a number of extra-ordinary measures to ascertain its future in the overly competitive industry.