The remaining interest of Samsung Fire & Marine Insurance could be solved by additionally purchasing 15.98 percent treasury shares owned by the non-life counterpart.
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Trade volume recorded 385.3 million shares worth 4.8 trillion won, with decliners outnumbering advancers 477 to 330. The move cements the life insurer’s control over Samsung affiliates and sets in the path for turning into the holding organization for all financial operations of the country’s largest conglomerate. Samsung now restructures its three main businesses to bio, electronics and financial sectors. In particular, Samsung Group plans to turn Samsung Life into the financial holding company when the law on intermediate financial holding companies passes.
The median price target price from a Thomson Reuters I/B/E/S survey of 43 analysts for Samsung Electronics shares is now 1.8 million won.
LG Display, Samsung’s local rival in display panels, and Naver, a local internet behemoth which recently floated shares for its messenger app service Line on the NY and Tokyo exchanges, also saw their stocks set new midday highs. Under local regulations, a financial holdings firm must be the largest shareholder with more than 30 percent of listed financial subsidiaries. It would have to sell its shares in Samsung Electronics to Samsung C&T to fully qualify as a financial holding entity. Accordingly, Samsung Electronics’ market value added 5 trillion won to reach 237.3 trillion won. Samsung Life also holds 98.7 percent in Samsung Asset Management Co. and 100 percent in Samsung SRA Asset Management Co. That gave credence to expectations that Samsung is taking steps to become a financial holding company. However, the company will come up with various alternatives as it costs a lot to buy Samsung Fire’s stakes. The state-run Korea Electric Power Corp. slid 1.37 percent to 57,400 won.
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An official from the financial industry said, “It will take a long time to come up with the measures to raise funds to acquire Samsung Fire’s stakes and lower Samsung Electronics’ stakes”.
