◇檢, only 75 minutes to recite the prosecution… “The goal of succession of control rights”
Part 25-2 of the Seoul Central District Criminal Agreement (Judge Park Jeong-je, Park Sarang, and Kwon Seong-su) opened a second trial preparation date for Vice-Chairman Lee and Samsung Group officials who were handed over to trial for violations of the laws on the capital market and financial investment business.
On the preparation date, the defendant was not obligated to attend, so Vice Chairman Lee did not appear on this day. He was arrested after being sentenced to two years and six months in prison at a repatriation trial for the destruction of the Gukjeong Nongdan case on January 18 and is serving in a Seoul detention center. As of the date of arrest, another trial in which he was involved as a defendant was held in 52 days.
The trial on that day began with the prosecution’s prosecution, and it continued for 1 hour and 15 minutes. Vice-Chairman Lee’s succession of management rights actually began in 2012, and the reasons why it became illegal was investigated.
The prosecution said, “The U.S. front office was an unofficial organization with no grounds under the corporate law, and was the highest authority in the group that assisted the head of the group.” As an incident, we mobilized all affiliates to plan and execute,” he raised his voice.
“The increase of Vice Chairman Lee’s dominance has already begun in 2012, and the merger of Cheil Industries and Samsung C&T secured the control of the group as a whole.” “I hurriedly and laid the groundwork for a favorable merger ratio,” he stressed.
In September of last year, the prosecutors reported that the Samsung Group planned and implemented a systematic plan to create a favorable situation for the succession of the management rights of Vice Chairman Lee during the merger process of Samsung C&T and Cheil Industries, and indicted the vice-chairman Lee and 11 Samsung officials without custody. According to the prosecutor’s office, Vice-Chairman Lee’s main allegations were △violation of the Capital Market Act, △dismissal in business, and △violation of the External Audit Act.
In other words, Vice-Chairman Lee and Mijeon deliberately dropped the value of Samsung C&T to create a favorable merger ratio (Cheil Industries: Samsung C&T = 1:0.35), which inflicted property damage such as loss of opportunities to increase corporate and shareholder value. Immediately after the merger, it is suspected that Samsung Bio changed the accounting treatment of its subsidiary Samsung Bioepis to an’affiliated company’ and converted Epis into a surplus company to rationalize the merger post-mortem. The prosecution’s complaint alone amounts to 133 pages.
◇ Lee Jae-yong’s side, denies all prosecutions… “Emphasis only on the motives of the merger.”
On the other hand, Vice-Chairman Lee denied all of the prosecution, saying, “The prosecution has infinitely expanded the subject of fraudulent fraudulent transactions, such as seeing all acts that occurred in the process of the merger between Samsung C&T and Cheil Industries as illegal.”
First of all, regarding the intentional manipulation of the merger ratio, “I think it is not included in the public complaint and is merely suspicious.” Rather, it is true that the intentional manipulation of the merger ratio suspected by civic groups due to a prosecution’s long-term investigation was true. “Isn’t it revealed that it’s not?” he refuted.
He then pointed out that the prosecution’s premise of’Cheil Industries overvalued-Samsung C&T’s undervalued’ was wrong. Vice Chairman Lee’s defense attorney said, “The prosecutors say that the important thing is the merger ratio, and only the purpose (motive) of the merger is’transfer of management rights’.” It was illegal, but I doubt whether this claim is correct.”
He also refuted that the charges could not be established for his job renunciation. The attorney said, “There is not a lot of meaning that it was added after one year and six months after the initial seizure of Samsung subsidiaries, and the contents of the warrant examination did not include work-related assignments,” he said. He said, “Isn’t it that even the prosecution needed to think about this part and was unclear enough to hesitate?”
In this regard, regarding the part stated in the indictment,’Mergers have inflicted property damage such as loss of opportunities to increase corporate value and shareholder value that could have been guaranteed through the establishment of appropriate merger transaction conditions and structure or selection of alternatives other than merger.’ “I don’t know if it’s right to say that I have lost the opportunity to increase value while claiming that the ratio is wrong.”
Regarding the prosecution of the external subtraction law, he pointed out that if Samsung Bio had suffered a tremendous fraudulent accounting of 4.5 trillion won, the company’s stock price had collapsed or it should have collapsed like the US’Enron crisis’.
The lawyer said, “How could we have grown by achieving sales of KRW 1 trillion after 9 years of incorporation, even though we did not inflate assets without Samsung Bio, and dealt with accounting in accordance with the economic substance as it is.” In addition, if Cheil Industries is expected to fall due to high valuation, as the prosecutors argued, he would have tried to minimize losses by net selling, but emphasized that the National Pension Service, etc., had net purchases worth 466.9 billion won (3,377,321 shares) of stocks before the announcement of the merger.
The lawyer said, “We cannot discuss overvalued or undervalued compared to sales, assets, and operating profits between companies with different industries and business structures. The market has information that anyone can know by looking at the Internet, and that is publicly confirmed and the stock price is formed.”
Regarding’Project G’, which was called a smoking case to reveal whether it was’the purpose of succession of management’, he said, “I don’t know why the purpose of strengthening control is a problem. Unless reinforcement of control over a specific person and company is legally prohibited, the combined purpose for management is not forbidden by law. If there was, there are precedents that have been admitted,” he refuted. The prosecution is considering Project G as a’succession plan’ carefully planned by the U.S. battlefield for the succession of Vice Chairman Lee.
On the other hand, in the trial on this day, in the process of refuting the fact of the prosecution by Vice Chairman Lee’s indictment of the prosecution and part of the minutes of the board meeting in a PPT, the prosecution said, “The attorney did it for the convenience of the pleading, but if the data is publicly displayed, it may be mistaken as if it were true. “There is,” refuted, and once a nerve war unfolded, such as going to and from Goseong.