‘Burden’ of $ 358 billion on the shoulders of ‘crown prince’ Samsung after his father’s death

Samsung Group Vice President Lee Jae-yong will almost certainly be the successor to the “throne” from his late father. However, in order to have a successful transformation, the Vice President needs to face many important tasks, of which the most urgent need is to solve 2 problems including: Overhauling the complicated stock structure of the episode. and improve business operations by finding new growth engines.

Since the late chairman Lee Kun-hee inherited control of the company from his father, founder Lee Byung-chull in 1987, the late chairman turned Samsung into a smartphone empire. The largest in the world, television, memory chips and home appliances.

Samsung reported annual sales of 10 trillion won in 1987 but the figure soared to 386 trillion won in 2018. The company’s market value has grown 396 times from 1 trillion won to nearly 400 thousand. billion won (approximately US $ 358 billion).

When President Lee dies, it is almost certain that Lee Jae-yong will inherit the throne in Kimchi’s largest company. Since the late chairman was hospitalized in 2014, “crown prince” Lee has not been officially appointed to the position of Chairman but only assumed the position of Vice Chairman.

Before Samsung Electronics became the world’s leading technology giant, analysts and authorities said that the 1993-born former chairman’s ambitions had begun a long journey to climb. to the top like now.

In 1993, the late Chairman Lee summoned all of Samsung executives, big and small, and attended a meeting unprecedented in the company’s history.

The meeting took place for 3 days, everyone was not allowed to rest, only time to sleep in the evening. During that time, Chairman Lee’s job was to lecture, lecture and lecture … continuously for 3 days.

There, he laid out his painful vision of the future of Samsung and what it would need to do to become successful internationally. In this speech, he also said a famous quote that would later go with the name Lee Kun-Hee: “You change everything, but absolutely not your wife and kids. ”

This speech was eventually known internally as Samsung internally “the 1993 Frankfurt Manifesto”. It was rewritten into a 200-page book, distributed to Samsung employees to instill the Chairman’s thoughts. For employees, without the chance to read, Samsung even produces cartoons with similar content for them to watch.

Since that day, the name Samsung has gradually become familiar in the world as a giant TV production, the world’s largest smartphone. The image of a producer who is frequently underdogs in the big races has almost disappeared.

Decisions of the “crown prince”

With the vision of turning Samsung from an anonymous company into a technology giant of the late chairman, it is still unclear what the vice chairman will now contribute to Samsung’s corporate growth and leadership. company in the era of the 4th industrial revolution.

Analysts said that the Vice President has also shown great decisions to help Samsung Electronics set out breakthroughs as soon as the giant falls into the “low-lying area” that needs great changes.

In 2016, “crown prince” Lee decided to buy American mobile car electronics company Harman for $ 8 billion to find a new growth rate when he witnessed the rapid growth of the connected car market.

The vice president also announced that they would invest 180 trillion won ($ 160 billion) focusing on improving Samsung’s capabilities in areas such as artificial intelligence, 5G networks, and automotive electronics. mobile…

He also revealed a business plan to make Samsung a leader in logic chips by 2030 by investing 133 trillion won to improve competition in System LSI … While Samsung Electronics is working. As the world’s leading manufacturer of memory chips, the company is still lagging behind in the non-memory segment – accounting for 70% of the memory chip market.

While the global economy struggled to overcome the difficulties of the Covid-19 pandemic, Mr. Lee strengthened his activities this year, visiting key manufacturing plants. companies in Korea and abroad. Earlier this month, Mr. Lee also met with the leaders of Finnish chip manufacturer ASML to strengthen the partnership.

Five days after his visit to Europe, Mr. Lee also visited Vietnam to visit the R&D center (research and development) under construction in Hanoi and their phone and display factories here.

Transfer of power, overhaul of apparatus

There remain open questions about whether a Samsung heir can successfully complete the inheritance process. The Vice President now controls the group with an extremely complex ownership structure, affiliated with Samsung C&T, Samsung Life Insurance and Samsung Electronics.

Of course, for Mr. Lee himself, it is very important to officially control the “throne” of Samsung. In the group’s affiliates, the Vice President holds a 4.18% stake in Samsung Electroncis, a 20.76% stake in Samsung Life Insurance and a 2.86% stake in Samsung C&T.

The conglomerate now has an extremely complex ownership structure with overlapping branches, allowing the founders’ family to control the business with only a very small stake.

In May, the Vice President sent a message that he would make the necessary changes to make the corporate ownership structure simpler. However, the transfer of power is expected to take longer than expected because the Vice President is currently involved in a series of legal accusations such as accounting fraud, securities manipulation, bribery. …