Most Popular
-
1
Dongduk Women’s University halts coeducation talks
-
2
Defense ministry denies special treatment for BTS’ V amid phone use allegations
-
3
Russia sent 'anti-air' missiles to Pyongyang, Yoon's aide says
-
4
OpenAI in talks with Samsung to power AI features, report says
-
5
Two jailed for forcing disabled teens into prostitution
-
6
South Korean military plans to launch new division for future warfare
-
7
Trump picks ex-N. Korea policy official as his principal deputy national security adviser
-
8
Gold bars and cash bundles; authorities confiscate millions from tax dodgers
-
9
Kia EV9 GT marks world debut at LA Motor Show
-
10
Teen smoking, drinking decline, while mental health, dietary habits worsen
Samsung officials probed for insider trading before C&T deal
By 서지연Published : Dec. 5, 2015 - 10:04
South Korea’s financial regulator is investigating allegations of insider trading by officials at Samsung Group before the merger of two key affiliates by the country’s biggest conglomerate.
The probe includes shares traded before Cheil Industries Inc. agreed to buy Samsung C&T Corp., Kim Hong-sik, an official at the Financial Services Commission, said by phone Friday. The all-stock merger was valued at $9.3 billion when it was announced in May.
Cheil’s acquisition, which helped the Lee family boost their control of the chaebol, was one of the most controversial in Korean history as billionaire activist investor Paul Elliott Singer bought a stake in C&T and sought to block the deal. Korea Exchange found nine high-ranking officials from as many as four Samsung companies bought Cheil stock in April and May, Yonhap News Agency reported earlier, without identifying sources.
“We have recently launched an investigation into alleged insider trading raised by the Korea Exchange,” Kim said.
Kim declined to elaborate, including whether the trades were done by a group of people or individuals, their timing and size.
“We understand the investigation involving certain individuals is still in its early stage,” Samsung Group said in an e-mail. “We will wait until the authorities conclude their investigation.”
Korea Exchange declined to comment. Shares of Cheil, which adopted the C&T name after the deal, rose on eight of the nine trading days before disclosing the all stock deal on May 26.
They reached 188,000 won the day of the announcement, 19 percent above their price at the start of the month.
Elliott Associates LP argued against the deal, taking to the courts and lobbying investors as Singer said it undervalued the construction company. The merger eventually passed after the Lee family gained the support of other shareholders.
A successful deal was critical to the founding Lee family because C&T held key stakes in other affiliates, including shares of Samsung Electronics Co., South Korea’s biggest company.
Samsung C&T is controlled by the Lee family and is Samsung Group’s de facto holding company. (Bloomberg)
The probe includes shares traded before Cheil Industries Inc. agreed to buy Samsung C&T Corp., Kim Hong-sik, an official at the Financial Services Commission, said by phone Friday. The all-stock merger was valued at $9.3 billion when it was announced in May.
Cheil’s acquisition, which helped the Lee family boost their control of the chaebol, was one of the most controversial in Korean history as billionaire activist investor Paul Elliott Singer bought a stake in C&T and sought to block the deal. Korea Exchange found nine high-ranking officials from as many as four Samsung companies bought Cheil stock in April and May, Yonhap News Agency reported earlier, without identifying sources.
“We have recently launched an investigation into alleged insider trading raised by the Korea Exchange,” Kim said.
Kim declined to elaborate, including whether the trades were done by a group of people or individuals, their timing and size.
“We understand the investigation involving certain individuals is still in its early stage,” Samsung Group said in an e-mail. “We will wait until the authorities conclude their investigation.”
Korea Exchange declined to comment. Shares of Cheil, which adopted the C&T name after the deal, rose on eight of the nine trading days before disclosing the all stock deal on May 26.
They reached 188,000 won the day of the announcement, 19 percent above their price at the start of the month.
Elliott Associates LP argued against the deal, taking to the courts and lobbying investors as Singer said it undervalued the construction company. The merger eventually passed after the Lee family gained the support of other shareholders.
A successful deal was critical to the founding Lee family because C&T held key stakes in other affiliates, including shares of Samsung Electronics Co., South Korea’s biggest company.
Samsung C&T is controlled by the Lee family and is Samsung Group’s de facto holding company. (Bloomberg)
