Tag: Lee Jae-yong

Samsung CEO Kwon Oh-hyun Resigns Under Mysterious Circumstances

Kwon Oh-hyun, CEO of Samsung Electronics and Samsung Display, vice chairman and head of Samsung’s components division has announced his resignation. He will step down from the role as well as his position on the board in March 2018.

Kwon Oh-hyun said in a letter to the employees:

It is something I had been thinking long and hard about for quite some time. It has not been an easy decision, but I feel I can no longer put it off. As we are confronted with unprecedented crisis inside out, I believe that time has now come for the company start anew, with a new spirit and young leadership to better respond to challenges arising from the rapidly changing IT industry.

There are no words to describe how proud I am that we built together one of the most valuable companies in the world. We have come a long way to create a company that truly changes how people live, work and communicate with each other. But now the company needs a new leader more than ever and it is time for me to move to the next chapter of my life.

Kwon joined Samsung in 1985, rising to lead its semiconductor business before his appointment as the CEO. He was appointed CEO of Samsung Electronics in 2012 and in 2016, he became the CEO of Samsung Display.

Samsung has had a very successful finanical year but, all may not be well in its leadership. The South Korean tech giant, Samsung expects its operating profit to nearly triple year on year, demonstrating a very strong recovery after the equivalent period in 2016 saw the infamous Galaxy Note7 recall. In his letter, Kwon cites “unprecedented crisis,” he might be referring to the arrest of Lee Jae-yong, the de facto leader of the entire Samsung group, on corruption charges. It looks like the scandal will slowly show the repercussions and Kwon Oh-hyun’s resignation seems like the fist indication. Samsung is yet to announce a replacement. It seems like one of the two “co-CEOs”, BK Yoon and JK Shin would replace Kwon. Will this internal turmoil affect Samsung and its future plans? We don’t think so.

October 13, 2017
Samsung Vice Chairman Lee Jae-yong Sentenced To 5 Year Prison Term For Corruption

Lee Jae-yong, the son of Samsung’s ailing chairman and vice chairman of Samsung Electronics has been found guilty of perjury, embezzlement, and bribery in South Korea. The presumed heir to the Samsung empire was sentenced to five years in prison on Friday, which was shorter than the 12-year prison sentence prosecutors had sought for.

Lee was arrested in February and was found guilty by a three-judge panel of Seoul Central District Court. Along with the Lee, four other Samsung executives were accused of offering bribes to former South Korean president Park Geun-hye. Prosecutors alleged that Lee and the other executives gave 43.3 billion won (approximately $38 million) in bribes to Park in exchange for government support for a merger that helped him tighten control over Samsung. The court also found Lee guilty of perjury for falsely testifying at a parliamentary hearing on the scandal, concealing criminal profits, embezzlement and hiding assets overseas. Contrary to which, Lee Jae-yong denied any wrongdoing, and his lawyers are expected to appeal the verdict. Regardless, the court stated that there was sufficient evidence to prove prosecutors’ charges.

Judge Kim Jin-dong said “The essence of this case is the unethical bond between politics and money,” and “I hope that power will be used to serve all people and that big businesses will act with social responsibility, through legal economic activities.”

Although, the Samsung chief was found guilty in today’s verdict, it doesn’t necessarily scuttle his chances for succeeding his father. But, due to the Chinese tradition of “filial piety”, the role of chairman may not pass down to Lee Jae-yong until his 75-year-old incapacitated father passes away.

Samsung has recently bounced back from what was a slow year in 2016 due to recalls involving its Galaxy Note 7 smartphone, and had success with the Samsung Galaxy S8 and S8+ and the newly launched Galaxy Note 8, but the criminal conviction of Samsung’s chief is a blow for the company and is bound to impact the smartphone maker’s credibility and reputation on the business side of things, if not consumer.

August 26, 2017
Samsung South Korea Leader Arrested for Bribery

Samsung’s vice chairman Lee Jae-yong has been arrested in South Korea for charges of bribery and of hiding criminal proceeds and violating laws pertaining to transferring assets abroad. The court had found him guilty in January of 2017, but a warrant for his arrest was made only yesterday for the remaining charges.

The rationale for and the necessity of (Lee’s) arrest is acknowledged considering the new charges and additional evidence collected- Said the court

The charge of significant proportions putts Lee Jae-yong for bribing the South Korean President Park Geun-hye $38 million for allowing special privileges to Samsung as a brand. The stories of Samsung being a company that has its roots stuck with bribery have been around since the time the founder of the company was charged with illegal business practices.

It just seems that the company cannot catch a break, failed Note 7, massive losses in the stock market and now this. The fy16-17 for Samsung has really not been good.

February 17, 2017