Recently there has been a lot of ongoing speculation about Samsung’s sudden decision to divide its already miserable business. The South Korean tech giants were reportedly considering splitting their company into two as suggested by Elliott Management, the US hedge fund management organization.
According to the report, the split up which would most certainly allow the Lee family to strengthen their claim on Samsung,(renowned smartphone leader), was an honest proposition made by Elliot in order to amp shareholder value.
The Proposal which came sometime in October left the company’s board of directors to decide on how they plan to respond to said proposal. Even though many are asking Samsung to clarify whether or not the company is looking to split as proposed by Elliot, the South Korean tech giants are still yet to utter a word.
Elliott who reportedly wants Samsung to possess a holding company for ownership reasons also feels the company would be better off if it had another arm that focuses solely on operations. The operational body of the supposed split company will reportedly pay a $26bn special bonus and ensure a free cash flow to investors of nothing less than 75% of the company’s total yield returns. With all this in place, Elliot is hoping Samsung should agree to appoint some autonomous directors as well.
Following the admission of his father to the hospital, Jay Y Lee took charge as head of two key foundations sometime in May 2015 and has since then been taking as well as making all major decisions pertaining to the company.