Samsung Electronics Co. Ltd. will buy back shares valued at 2.2 trillion won ($2 billion), the world’s largest smartphone maker said in a filing, after its parent Samsung Group, said it will shed two businesses that are not core to its business.
Samsung Electronics will buy back 1.65 million common stock and 250,000 preferred stock, the company said in the filing on Wednesday. The mobile-phone maker and other group companies will also sell their stakes in Samsung Techwin Co. Ltd. and Samsung General Chemicals Co. Ltd. to another South Korean conglomerate Hanhwa Group.
The sale will fetch 1.9 trillion won ($1.7 billion), Bloomberg reported, citing a statement by Hanhwa Group.
“The purpose of asset sale is (to) secure capital resources for investments in new businesses and to strengthen the Company’s core competency,” Samsung said, in its filing.
The sale and the share buyback are seen as part of an ongoing restructuring at Samsung, as South Korea’s largest business group faces a change of guard at the top, following Chairman Lee Kun-hee’s hospitalization in May after a heart attack. His son and Vice Chairman Lee Jae-yong is seen to be in charge of driving the consolidation at the conglomerate.
On Tuesday, reports said that Samsung Electronics is considering a major reorganization that could cost J.K. Shin, head of the company's struggling mobile division, his position.