Hong Ra-hee, honorary director of the Leeum Museum of Art, will sell a 0.11% stake in Samsung Electronics to Samsung Electronics Chairman Jay Y. Lee in an off-market transaction valued at about 1.94 trillion won ($1.4 billion). The block trade between major shareholders was chosen over a market sale to minimize the impact on the share price.
According to a regulatory filing with the Financial Supervisory Service's electronic disclosure system on the 9th, Lee plans to purchase 7,188,793 common shares of Samsung Electronics held by Hong in an off-market deal on the 12th of next month.
The transaction price is 269,500 won per share, based on Samsung Electronics' closing price on the 8th, the business day before the filing was submitted. The total value comes to about 1.9374 trillion won.
Once the deal is completed as planned, Lee's holdings in Samsung Electronics will rise to 104,740,746 shares from the current 97,551,953 shares. His stake will increase to 1.58% from 1.47%, a gain of 0.11 percentage point.
Samsung has not issued an official statement on the rationale for the deal, noting that it is a private transaction between major shareholders. "Because this is a private transaction between major shareholders, there is no official position we can disclose," a Samsung official said.
Industry watchers believe Hong is selling part of her stake to repay loans taken out to cover inheritance taxes following the death of late Samsung Chairman Lee Kun-hee.
Given that the deal lifts Lee's stake by only 0.11 percentage point, analysts said the transaction is better understood as a share transfer between major shareholders than as a move to strengthen management control.
