Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

S.Korea's Yoon pardons Samsung's Jay Y. Lee to counter 'economic crisis'

Stock Markets Aug 12, 2022 04:30AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
2/2 © Reuters. FILE PHOTO: Samsung Electronics Vice Chairman Jay Y. Lee arrives at a court in Seoul, South Korea, October 26, 2021. REUTERS/Kim Hong-Ji 2/2
 
KS11
+0.13%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
ASML
+0.39%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
005930
+0.56%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
SSNLF
0.00%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Joyce Lee, Soo-hyang Choi and Heekyong Yang

SEOUL (Reuters) -South Korea's President Yoon Suk-yeol pardoned Samsung Electronics (OTC:SSNLF) Vice Chairman Jay Y. Lee on Friday, with the justice ministry saying the business leader was needed to help overcome a "national economic crisis".

The pardon is largely symbolic, with Lee already out on parole after serving 18 months in jail for bribery in a scandal that led to massive protests and brought down then-President Park Geun-hye in 2017.

However, analysts said the pardon should mean Lee will be able to carry out business activities with fewer legal restrictions, and could herald some large investments from Samsung (KS:005930), the world's biggest smartphone and memory-chip maker.

"With urgent needs to overcome the national economic crisis, we carefully selected economic leaders who lead the national growth engine through active technology investment and job creation to be pardoned," Justice Minister Han Dong Hoon told a briefing.

Tech- and export-dependent South Korea, Asia's fourth-largest economy is grappling with soaring inflation, weakening demand, poor sentiment and slowing spending.

Lee, an heir of Samsung's founding family, welcomed the decision and vowed to work hard for the national economy "with continuous investment and job creation."

Also pardoned by the pro-business Yoon was Lotte Group chairman Shin Dong-bin, who was sentenced to a two-and-a-half-year prison sentence on charges of bribery, also related to Park.

In a statement, Lotte said Shin would also help in "overcoming the complex global crisis."

POLITICAL CRIMES

Park herself was pardoned late last year by her successor, liberal president Moon Jae-in, who struggled to follow through on campaign vows to clean up business and politics.

A survey conducted last month jointly by four pollsters showed that 77% of respondents favored pardoning the Samsung leader, despite the earlier protests.

"(That support) is apparently due to the current economic situation, but people also seem to have thought in part that Lee was somewhat in a position where he could not shrug off pressure from the former administration," said Eom Kyeong-young, a political commentator based in Seoul.

While business groups including the Korea Chamber of Commerce & Industry and Korea Enterprises Federation welcomed the pardon for Lee, civil rights groups criticized Yoon's pardons for businessmen.

"The Yoon Suk-yeol administration... is ultimately just aiming for a country only for the rich," People's Solidarity for Participatory Democracy said in a statement.

Another jailed former president, Lee Myung-bak, had been expected to be pardoned after Yoon raised the possibility in June, but was ultimately not on the list. He was arrested in 2018 and sentenced to 17 years in prison for corruption, embezzlement and bribery.

BACK IN BUSINESS

Analysts have long expected decisions on major projects and investments once Lee was reinstated, with company sources saying such decisions should only be made by Lee.

"This removes the employment restriction Lee was technically under," said Park Ju-gun, head of research firm Leaders Index.

"And projects that were being pursued by Samsung, such as major M&A or investments, these could be tied to the pardon."

Even before receiving the presidential pardon, Lee had returned to the limelight, appearing in May with President Yoon and U.S. President Joe Biden when they visited Samsung's Pyeongtaek chip production facilities.

He has also visited Europe in June to meet ASML Holding (NASDAQ:ASML) NV CEO Peter Wennink, discussing the adoption of key high-end chip equipment.

Last November, Samsung decided on Taylor, Texas as the site of a new $17 billion chip plant.

Top Samsung executives have hinted earlier this year at potential upcoming acquisition activity. Samsung Electronics has not conducted a high-profile deal since it completed its purchase of audio electronics maker Harman for $8 billion in 2017.

Although macroeconomic factors such as a demand downturn may weigh on investment decisions, Samsung has a huge war chest.

Samsung Electronics' cash balance increased slightly to 125 trillion won ($95.13 billion) as of end-June, from 111 trillion a year earlier.

While experts say Lee could now more freely participate in management, his legal woes persist due to an ongoing trial where he faces the risk of returning to jail if found guilty of charges of fraud and stock manipulation.

Shares in Samsung Electronics closed up 0.5% versus benchmark KOSPI's 0.2% rise. Lotte Corp shares were down 0.6%.

S.Korea's Yoon pardons Samsung's Jay Y. Lee to counter 'economic crisis'
 

Related Articles

U.S. to appeal court loss against sugar merger
U.S. to appeal court loss against sugar merger By Reuters - Sep 27, 2022 1

WASHINGTON (Reuters) -The U.S. Justice Department said on Monday it would appeal a judge's ruling that U.S. Sugar Corp's plans to buy rival Imperial Sugar Co was legal under...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
SEUNG RHEE
SEUNG RHEE Aug 12, 2022 12:07AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
President Yoon is living in a rent apartment of Samsung Electronics.  Is this a joke? Another Park Keun Hae or Lee Myung Bak in prison?  This country is full of thieves that most of the presidents go to prison directly after its mandate.
JongUn Kim
JongUn_Kim Aug 12, 2022 12:07AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Do not spread the fake news. your nonsense suspection never be the reason for the news' reliability.
Kris Jay
Kris Jay Aug 11, 2022 10:44PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
President Yoon Suk-yeol also said "Thank you for the Samsung stock.   I learned a lot from the Pelosi's on how politics and business can work together"
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email