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Owner family expected to sell Samsung affiliates' shares over next 5 years
By Lee Kyung-min
The family of late Samsung Group Chairman Lee Kun-hee is expected to continue selling its shares in the group's affiliates over the next few years to cover a 2.9 trillion won ($2.3 billion) shortfall in inheritance taxes that total around 10 trillion won, according to market watchers.
They say the family can increase dividends or take out securities-backed loans, two highly viable options along with selling shares that would have a limited impact on the group's overall cross-shareholding structure.
The family members are Hong Ra-hee, the director of Leeum, Samsung Museum of Art, Samsung Electronics Vice Chairman Lee Jae-yong, Hotel Shilla CEO Lee Boo-jin and Samsung Welfare Foundation Chairwoman Lee Seo-hyun.
The wife and three children of the late Samsung chairman paid around a sixth of a total of 12 trillion won in inheritance taxes last April. The remaining 10 trillion won will be paid in installments over the next five years. Of the total, 11 trillion won was for inheriting stocks.
The wife and two daughters have sold a combined 1.98 trillion won worth of Samsung-related shares so far.
However, the amount combined with the four family members' annual dividend income of 856.8 billion won and earnings from other arrangements still falls 2.9 trillion won short of the 10 trillion won.
Hong sold over 19.94 million shares of Samsung Electronics at 68,800 won per stock on March 24. The total amount of 1.37 trillion won accounts for 0.33 percent of her total shares. The per-share price was 2.4 percent lower than the closing price in the previous session.
Lee Boo-jin and Lee Seo-hyun have sold a combined 610 billion won worth of Samsung SDS and Samsung Securities shares.
Yuanta Securities analyst Choi Nam-kon said the owner family would need 580 billion won every year for the next five years to meet the 2.9 trillion won shortfall.
"The family paid 1.15 trillion won in the first installment last year and has to pay 1.97 trillion won every year from 2022 to 2026," he said in a report.
"If the owner family members are to secure 2.9 trillion won by reducing their stock holdings, they are likely to sell shares that would not dramatically affect the group's shareholding structure," he said.
Of the 11 trillion won, 3.1 trillion won will be paid by Hong. The Samsung Electronics vice chairman will pay 2.9 trillion won, the Hotel Shilla CEO 2.6 trillion won and Samsung Welfare Foundation chairwoman 2.4 trillion won.
