Samsung Electronics chief Lee Jae-Yong has been acquitted by a South Korean court on Monday of various charges related to a controversial 2015 merger, as reported by local media, including Yonhap.
The court cited a lack of evidence proving an intention to harm shareholders through the merger, which critics argued was undervalued and orchestrated mainly for a smooth generational power transition within Samsung’s founding family.
“Solidifying Lee’s control and ensuring his succession wasn’t the only purpose of the merger,” the court ruled, according to the Yonhap news agency, adding that there were “no validations to prove prosecution’s charge”.
The verdict clears Lee of charges such as stock price rigging, breach of trust, and accounting fraud in the merger between Samsung C&T and Cheil Industries.
“A structure in which company’s owner groups are allowed to pursue personal interest is the biggest cause of the worsening Korea discount,” the prosecution said, referring to the perceived global undervaluing of South Korean businesses.
“We feel utterly distressed it was done by Samsung, the country’s number-one company.”
Despite opposition claiming deliberate undervaluation of the construction firm’s stock, the court emphasized the absence of validation for the prosecution’s charges. Lee, previously jailed over a fraud case, currently serves as the executive chairman of Samsung Electronics.
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The acquittal is anticipated to positively impact Samsung Electronics, a key player in the global memory chip market, and has sparked varying reactions, with some expressing dismay at what they perceive as a lenient ruling.
Source: AFP
