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Samsung Shares Surge As Jay Y Lee Set To Take Charge After Father's Death

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Samsung Shares Surge As Jay Y Lee Set To Take Charge After Father's Death

Samsung Electronics Co. Ltd. and affiliate stocks witnessed a surge in South Korea on Monday. Samsung C&T Corp rallied by 13.46%, Samsung SDS Co Ltd rose 5.51%, and Samsung Life Insurance Co Ltd gained 3.8%. 

What Happened: The stock market is reacting over a change in leadership after the death of Chairman Lee Kun-Hee on Sunday, according to CNBC.

Vice-Chairman Jay Y. Lee, son of Lee Kun-Hee, has been at the helms of the company since 2014 when Senior Lee was diagnosed with health troubles.

Daiwa Securities Executive Director and analyst SK Kim attributed the stock price movement as an “impact from the succession,” CNBC reported. Kim noted that Samsung's affiliate stocks rose as Jay Y. Lee was the “de facto leader of the Samsung group” with sizeable holdings in Samsung SDS and Samsung C&T.

Why Does It Matter: According to the Wall Street Journal, it is unclear if Lee Kun-Hee's holdings in Samsung would be inherited by Jay Y. Lee or his siblings.

The Journal cited Park Sang-in, a Seoul National University professor studying succession planning at South Korea’s dynastic companies, who believes that while Jay Y. Lee is unlikely to be challenged for the role of the Samsung Chairman, his sisters could still be in a position to spin off some parts of the company.

Jay Y. Lee is facing ongoing legal cases over bribery and financial fraud.

 

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