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Samsung boss dies as ex-son tries to take control of world’s largest phone maker

SEOUL – Now the battle is raging for “the Republic of Samsung”.

Samsung boss Lee Kun-hee, arguably Korea’s most admired man, if he is hated, died on Sunday leaves his son Lee Jae-yong grappling with authorities and a legion of lawyers for the control of the empire which controls 20% of Koreans. economy. The world’s largest smartphone maker has a turnover that exceeds many republics.

Lee Jae-yong, or Jay Lee, was in Vietnam, where Samsung Electronics produces the majority of its smartphones, when he learned his father was on the verge of death.

Jay Lee, 52, visited his father’s bedside at a Samsung hospital here in Seoul before taking his last breath. Her father, 78, had been bedridden and mostly in a coma since suffering a heart attack six years ago.

While in Vietnam, Jay Lee had managed to avoid the opening of the latest trial by prosecutors who wanted to charge him with manipulating the share prices of two Samsung companies in order to secure his legacy.

“Jay Lee’s estate is not guaranteed.“

– Geoffrey cain

Having already spent a year in prison while on trial for bribery by ousted Korean President Park Geun-hye, Lee now faces more prison terms if prosecutors can sentence him to another sentence – this time for lowering the price of the share of a company to be merged with another. By achieving this merger –Hey Presto! –Lee hoped to own enough shares in the merged companies to have a controlling stake in Samsung Electronics, the crown jewel of an empire with some 80 companies ranging from shipbuilding and insurance to construction and others. by an amusement park rivaling any Disneyland.

Jay Lee is an engaging figure unlike his stern father, who took over the band from his own father, Samsung founder Lee Byung-chull, over 30 years ago. And, just to show he’s meant, he’s officially apologized for his rule-bending efforts to get what he sees as his dynastic right.

“Samsung and I have been reprimanded for the succession issue,” he said, sounding appropriately penitent when he vowed “to try not to have any further controversy over management succession”.

However, these fine words are looked down upon by reform authorities and it is the question of succession that is sure to consume his energy once he has undergone a complex funeral. His father was the richest man in the country, whose net worth of nearly $ 21 billion made him the 67th richest person in the world, according to Forbes.

Jay Lee, already the second richest man in Korea with a net worth of $ 6.4 billion, has perfected the art of demonstrating humility in the face of the powers that be. But Korean President Moon Jae-In wants to reform the country’s traditional dynastic conglomerate system known as the chaebol, which keeps huge companies in the hands of a few wealthy families and effectively controls the entire economy. The current system has led to fierce disparities between rich and poor – brilliantly illustrated by the Oscar winning film Parasite.

Geoffrey Cain, author of the new publication Samsung Rising, the inner story of the South Korean giant who decided to beat Apple and conquer technology, sees the HBO series Succession as an even more appropriate artistic representation. Scene after scene captures the battle to secure a family business, making it “a fitting spectacle to understand the Lees,” Cain said.

It’s not as if Jay Lee’s two sisters, who would inherit lesser parts of the empire, were fighting him for a greater share of the legacy, but the machinations to grab and hang on to them. enemies have distinct similarities.

“The bigger question is how Jay Lee will cement ownership control when he might not have enough stock to control the company,” Cain told The Daily Beast. Big problem: “He might have to sell stocks to pay his colossal estate tax estimated at $ 6 billion split between him and his sisters.

He is also facing a maternal problem. His mother, Hong Ra-hee, “obtains a significant portion of the president’s assets which could hamper Jay Lee’s quest to control the business,” Cain said. “Jay Lee’s estate is not guaranteed.”

One of the reasons prosecutors would be so keen to punish Jay Lee – as seen in his current trial – is resentment over the breaks Lee Kun-hee received from Tory Presidents in the years before the Revolution. 2016 candlelight ousted Park Geun-hye.

Jay Lee’s father was pardoned in 1997, when conservative Kim Young-sam exonerated him after he and others were convicted of bribery charges, and again 10 years later when he was convicted of massive tax evasion, among others. Forced to resign as chairman of Samsung Electronics, he was taken down completely when Lee Myung-bak, the conservative businessman who was then chairman, granted him a full pardon in 2009.

Jay Lee, however, has a lot of supporters. Lawyer Tara Oh, a retired US Air Force intelligence officer who founded and is now president of the East Asia Research Center in Washington, accuses the government of “aggressive and unreasonable investigations against the company” and denounces the charges against him as “Frivolous, without merit and unjust.”

In a lengthy review of the whole case against Samsung, Oh claims Jay Lee was “convicted of a felony without evidence” simply to justify the impeachment of Park Geun-hye, who was convicted of corruption and influence peddling and sentenced to 25 years. years in prison. It was Samsung’s gift of two horses for the riding daughter of a Park confidant that sparked a series of events that precipitated Park’s downfall. “My kingdom for a horse” was the title of a the Wall Street newspaper history at the time.

“The Moon administration seems interested in taking control of Samsung,” Oh wrote. “Globally, the actions of the Moon administration threaten the future of 5G technology developments as well as the global supply chain for life-saving biopharmaceuticals and COVID-19 treatments.”

Jay Lee himself avoids what might appear to be inflammatory statements. In meetings with executives as well as occasional sessions with lower-level staff, he sounds almost soft and modest, the complete opposite of his late father.

Lee Kun-hee, who put Samsung Electronics on its path as the world’s leading smartphone maker and also a producer of nearly half of the world’s memory chips, is remembered for berating those around and below of him, haranguing them in 10 o’clock meetings and just once. destroy Samsung products which it believes were inferior to those of its competitors.

Rightly he is most cited for shouting “Change everything but your wives and children!” to executives at a meeting in Frankfurt in 1993.

After presiding over Samsung’s rise from an also-headed competitor to world domination, Lee Kun-hee’s final years were marked by a debilitating illness. Long before he suffered his heart attack in 2014, he had been treated for cancer and lung disease and used a wheelchair.

The explosive formal statement released by Samsung after his death did not exaggerate its success: “President Lee was a true visionary who turned Samsung into a world-class innovator and industrial powerhouse from a local company .

It was true, but the last line of the statement is still up for grabs. “His inheritance will be eternal,” he said. If prosecutors are successful in her son’s final trial, Lee’s legacy won’t last forever after all.

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