BUSINESS

Samsung SDS faces fierce opposition over split-off plan

By Kim Young-won
  • Published : Jun 13, 2016 - 14:12
  • Updated : Jun 13, 2016 - 14:29
A group of small investors intend to pay another visit to the head office of Samsung SDS, an information solutions business arm of Samsung Group, to protest the company’s planned split-off of its logistics solution business.

Samsung SDS Small Investors’ Group said Monday that it would visit the firm on Tuesday afternoon to express its objection toward the proposed split-off plan.

A man passes by Samsung SDS’ head office in Seoul.
(Yonhap)

“During the previous visit to the company, a Samsung SDS executive promised that the company would make efforts not to damage shareholder value by avoiding the physical division of the business,” the group said in a statement.

“However, they changed their stance, according to several news reports, saying they are considering all possible options including the physical division of the firm,” the group said.

Around 10 representatives of the investors’ group had met with the firm’s executives on June 7.

On the group’s website, more than several dozen investors expressed their support for the plan to visit the company for a meeting with Chung Yoo-sung, the chief executive of the firm, and Samsung SDS president Hon Won-pyo.

Samsung has long denied rumors about the division of the company into several units and mergers between the units and other Samsung Group affiliates.

Some market analysts have forecast that the IT solution business of SDS and the logistics solution business will be merged with electronics giant Samsung Electronics and construction and trading firm Samsung C&T, respectively.

“SDS’ merger attempt with Samsung C&T seems to be in line with the conglomerate’s initiative for corporate restructuring,” said Lee Sang-heon, an analyst from HI Investment & Securities, in his investment report, adding that C&T would be able to play a more core role than before as a de facto holding company of Samsung Group down the road.

By Kim Young-won (wone0102@heraldcorp.com)

The Investor