“Samsung’s leadership faced another disarray.”
On the 23rd, the Wall Street Journal (WSJ) announced the news of Samsung Electronics’ review of the expansion of the US foundry (consigned semiconductor production) facility, and cited the absence of vice chairman Lee Jae-yong as a variable. WSJ pointed out that “Vice-Chairman Lee has finally approved all important business decisions for Samsung.”
Actually, Samsung’s concerns do not stop at the complicated domestic and overseas business environment. Since 2014, Vice Chairman Lee has been at the top of Samsung Electronics’ large-scale investment and merger and acquisition (M&A) procedures. The decision of each business unit is coordinated by the CEO of each business unit and the project support TF (task force), and Vice Chairman Lee makes the final decision.
Acquisition of Harman, a global automotive electronics (electronic device) company, in 2016 (approximately 10 trillion won), Samsung Display’s QD (quantum dot) display facility investment in 2019 (1.3 trillion won), and production of NAND flash and foundry in Pyeongtaek 2 plant in 2020 Line construction (approximately 20 trillion won) is also a big project that would not have been implemented without Lee’s final decision.
The expansion of the US foundry plant is evaluated as a complex problem that cannot be compared with domestic investment. It does not stop at the problem of investments exceeding 10 trillion won. This is because trade disputes between the US and China are intertwined, requiring even’political judgment’. A senior Samsung official said, “In the case of US semiconductor investment, the total number of semiconductor investments in the US should make the’best judgment’ at the’best time’ using global networks.” Among experts, it is pointed out that “the global management environment is constantly changing due to the inauguration of the US Joe Biden administration,” and “leadership gap is not a small risk to Samsung.”
Samsung is exploring various ways to minimize Lee’s management gap. Samsung has decided not to reappraise Vice Chairman Lee’s court trial. For the reappeal, which is the deadline on the 25th, the relevant documents must be submitted to the court by the day before, but Samsung did not show any movement.
It is said that even within the legal profession, the analysis that even if Samsung makes a re-appeal, it will not be as beneficial as it has already been judged by the Supreme Court legally. Imprisonment of 2 years and 6 months does not meet the requirements for re-appeal under the Criminal Procedure Act, making it difficult to contend with’illegal sentencing’. The fact that Vice Chairman Lee emphasized’compliance management’ as his first message in prison is also giving strength to the possibility of giving up reappeals. Some analyzes say that the gap should be minimized by receiving a report on management issues from prison and executing them after an early decision on the sentence.
Vice-Chairman Lee was sentenced to two years and six months in prison at the remand court for revocation, but even though his sentence was finalized after serving for about one year from 2017, the remaining serving time is about one year and six months. Recently, public opinion about vice-chairman Lee’s pardon’ or’parole’ has spread.
Reporter Jungsoo Hwang/Jungmin Nam [email protected]
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