Shares of a luxury hotel led by Samsung Electronics Vice Chairman Lee Jae-yong’s younger sister were on the rise amid rumors that she might fill the group’s leadership vacuum.
Shares in Hotel Shilla, led by Lee Boo-jin, the eldest daughter of Samsung Group Chairman Lee Kun-hee, soared Friday as market watchers speculated the 46-year-old female tycoon may succeed her brother in managing South Korea’s most powerful conglomerate.
Samsung Group Chairman Lee Kun-hee (right) is accompanied by his eldest daughter Lee Boo-jin as they enter Shilla Hotel in Seoul on Jan. 2, 2013 to attend a New Year’s ceremony with the group’s senior executives. (Yonhap)
Shares in Hotel Shilla soared more than 5 percent at the opening Friday, before closing up 0.96 percent at 47,400 won ($41.39).
Preferred shares of Hotel Shilla hit the daily upward limit of 30 percent to reach 65,000 won, 15,000 won higher than the previous trading.
The benchmark Korea Composite Stock Price Index inched down 0.06 percent to 2,080.58 points Friday.
Investors have paid close attention to testimony by Park Won-oh, a former executive at the Korea Equestrian Federation and a close associate of President Park Geun-hye’s confidante Choi Soon-sil. He reportedly claimed Lee Boo-jin has more support from her mother Hong Ra-hee than her older brother in terms of succession.
Lee Boo-jin is said to resemble her ailing father the most in character and management style among the three children.
An official at Samsung dismissed the possibility Friday, saying that there will not be any fundamental changes in leadership.
Samsung Electronics, meanwhile, fell more than 1.5 percent in morning trading and closed 0.42 percent lower at 1.89 million won. Other shares linked to Samsung, including Samsung C&T, Samsung Insurance and Samsung Cards also declined.
There are 15 Samsung-related companies listed on the Kossi and one on the tech-heavy Kosdaq. They account for 30 percent of South Korea’s bourses, as of Thursday.
“[The arrest of Lee Jae-yong] could pose a short-term threat to the company, as the restructuring of Samsung Group may be delayed with the arrest of Lee Jae-yong,” Kim Byung-yeon, an analyst at NH Securities and Investment said.
Shares in Samsung C&T, at the heart of succession issue, dropped 1.98 percent to to 124,000 won, while Samsung SDS fell 0.78 percent to 128,000 won Friday.
By Park Ga-young (firstname.lastname@example.org