With Samsung Electronics Vice Chairman Lee Jae-yong freed from jail Monday, the nation’s largest conglomerate is expected to accelerate new businesses that have been on hold in the absence of its de facto leader.
“We are very relieved to hear the court decision, although we are still cautious about making any comments as the very final stage remains,” said a source from Samsung.
As Lee still has to wait for the final decision by the Supreme Court, he is unlikely to immediately return to the company’s management. The vice chairman is expected to make his way back into management by settling key pending issues.
Lee is expected to focus on alleviating concerns about the prospects of the firm’s mainstay, the chip business. Last year, Samsung Electronics posted record earnings driven by the favorable chip industry. However, concerns have been growing due to rising US protectionism and heavy investment from China that could lead to oversupply issues.
Samsung Electronics Vice Chairman Lee Jae-yong (Yonhap)
Samsung has been in gridlock, as the management without the company’s de facto leader faced difficulties in greenlighting trillions of won of investment in next-generation chip technologies.
Apart from chips, Lee is also expected to look into merger and acquisition deals or heavy investment in new technologies. Samsung has barely made moves in acquiring new businesses following the purchase of the US infotainment firm Harman in November 2016, while global tech firms, including Google and Apple, continued to make investments in artificial intelligence, the internet of things and self-driving technologies.
In 2016, before Lee was arrested, Samsung had acquired six firms that cost more than 100 billion won in value.
Samsung is expected to eye new technologies such as self-driving or artificial intelligence technologies, industry watchers said.
“Lee’s return will be greatly helpful to Samsung at a time when it needs to find new businesses beyond chips and smartphones. In making strategic partners or making new investment, Lee’s role is important,” said Lee Byung-tae, a professor of business administration at KAIST.
The vice chairman is also expected to focus on recovering its lost global network. After Lee was arrested, he stepped down as the outside director of Exor, an Italian investment company and owner of Fiat Chrysler Automobiles. He also left the board of the Boao Forum, known as Asia’s Davos Forum, early this year.
“He is expected to continue the lost global network activities. Samsung is now standing at the crossroads to determine whether it will go independently or make partnerships with global firms, when tech firms, including Google and Amazon, are focusing on platforms connecting everything from devices, appliances to automobiles,” said Park Ju-gun, head of the research firm CEO Score.
By Shin Ji-hye (firstname.lastname@example.org)