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[Newsmaker] Samsung stock surge a boon to Lee family

Common stock under Samsung saw combined 111.5 trillion won gain in asset value this year while awarding 6 trillion won in increased stock wealth to members of Samsung’s owner family

Oct. 9, 2017 - 15:53 By Son Ji-hyoung
Common stock of firms under South Korea’s largest conglomerate Samsung saw a combined 111.5 trillion won ($97.3 billion) gain in asset value this year, not only spearheading a stock market rally but also awarding 6 trillion won in increased stock wealth to members of Samsung’s owner family, data showed Monday. 

Hotel Shilla President Lee Boo-jin (left) and Samsung Chairman Lee Kun-hee (Yonhap)
The combined market cap of 15 Kospi-listed and one Kosdaq-listed common shares affiliated with the conglomerate rose 30.6 percent to 476 trillion won as of Sept. 28, from 364.5 trillion won on Jan. 2, showed data from local market tracker FnGuide.

More than 4 out of 10 market cap increases in both the top-tier and second-tier markets this year stemmed from the conglomerate, showed the data.

Riding the global tech boom, the conglomerate’s crown jewel, Samsung Electronics, led the rally.

The Kospi bellwether and a maker of high-end smartphones and microchips, Samsung Electronics, made stock benefits worth 81.4 trillion won over the cited period, accounting for 73 percent of the group’s earnings.

Samsung Electronics’ market cap alone surged to 335.3 trillion won, accounting for over 22 percent of the exchange’s market cap, from 253.9 trillion won in early January.

Other Samsung-affiliated tech units, such as Samsung SDI and Samsung Electro-Mechanics saw their respective market caps double. Samsung SDI soared 97.6 percent, while Samsung Electro-Mechanics advanced 103 percent.

Biopharmaceutical arm Samsung BioLogics also contributed to the group’s upsurge, with a 113.4 percent rise this year.

Owner family members of Samsung Group saw their stock asset value jump in tandem amid the group’s leadership vacuum, according to another set of data from FnGuide.

Ailing Samsung Chairman Lee Kun-hee took a stock fortune worth 3.9 trillion won this year until Sept. 28, while his son, Samsung Electronics Vice Chairman Lee Jae-yong, who is in jail for bribery, earned 1.1 trillion won worth of stock benefit.

The stock assets held by the father and son, though not active in management, were the first and second-highest in Korea, with a net stock worth of 18.3 trillion won and 7.8 trillion won respectively.

Samsung Group Vice Chairman Lee Jae-yong (Yonhap)
Other Samsung family members saw a steep increase in their stock assets. The stock net worth of Hong Ra-hee, the wife of Chairman Lee, jumped by 954.9 billion won, making Hong the seventh-richest in stock value in September. The chairman’s daughters, Hotel Shilla President Lee Boo-jin and Samsung C&T President Lee Seo-hyun, both took profits worth 162.8 billion won respectively through their stock ownership.

As of June, Samsung has 16 listed affiliates, with 46 affiliates being unlisted, according to a regulatory filing to the Financial Supervisory Service.

Other major conglomerates, SK Group and LG Group, saw their common shares’ combined market caps increase 41.2 percent and 30.2 percent in nine months, respectively.

In contrast, Hyundai Motor Group saw 9.8 percent of market cap decrease in September from January.

The four major conglomerates’ 55 common shares led to a combined 160.2 trillion won market cap increase in the stock market, taking up some 62 percent of the entire market cap increase both on the Kospi and Kosdaq.

Meanwhile, two self-made billionaire entrepreneurs managed to join the top 10 list of stock asset value. Bang Jun-hyuk, chairman of Netmarble Games, took sixth place, with a net worth of 3.1 trillion won, after his stock asset value skyrocketed from 28.2 billion won in nine months. Seo Jung-jin, chief executive of biotech firm Celltrion, ranked eighth, with 2.6 trillion won in net worth.

By Son Ji-hyoung