Samsung Group’s headquarters in Seoul has been raided by public prosecutors investigating a merger between two Samsung affiliate companies. The day long sweep of the offices was also accompanied by a similar raid on South Korea’s largest pension fund, the National Pension Service; which was responsible for pushing the merger through.
Investigators are looking into the circumstances in which the approval for an $8 billion merger between Samsung C&T Corp and Cheil Industries was received. The action allowed Samsung’s vice chairman Lee Jae-yong to strengthen his grip on the immensely important Samsung Electronics business.
The merger was originally contested as being unfair to smaller shareholders, and was only approved due to the vote from the NPS. The pension fund controlled 11.2-percent of the vote in Samsung C&T; the largest single shareholder in the company.
However, the decision to approve the merger apparently comes from an unknown source; and is why investigators have begun looking into the action. It is believed that this investigation is part of a wider probe of the political scandal surrounding president Park Geun-hye; who has been indicted of misusing her influence.
President Park has supposedly used her power to pressure South Korea’s largest conglomerates to donate money to her social programmes. Samsung is not the only company that has been dragged into the scandal, as bosses from Hyundai and LG have also been summoned to meet with public prosecutors.
[Source: Reuters, Wall Street Journal]
