Samsung is considering ‘a holding company structure’

By : |November 29, 2016 0

From exploding batteries of smartphones to washing machines, Samsung has so far faced lot of fire in 2016. Now to appease the exasperated investors, the South-Korean giant is apparently working on various “roadmap of actions” including “creating a holding company structure,” according to a statement.

A holdings company is basically one that owns other companies outstanding stock. Such a company does not produce goods or services itself but owns shares of other companies to form a corporate entity. So, it holds the reign without being involved in the day to day affairs of the companies.

Samsung is apparently also exploring various options regarding the leadership and governance thing as proposed by activist investor Elliott Management.

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“In recognition of the ever more global nature of Samsung Electronics business, the company’s board of directors is pursuing plans to invite new independent board members with international corporate experience. With the help of outside advisors, the board is in the process of identifying a number of highly qualified candidates and plans to nominate at least one new board member with robust global C-suite experience for approval at the next annual shareholder meeting in March 2017,” Samsung said in the official statement.

With regard to governance, it said, “The Board aims to further strengthen corporate governance procedures by creating a new governance committee, comprised solely of independent board members. The committee will address Board decisions and proposals linked to enhancing shareholder value. It will also assume the responsibilities of the current corporate social responsibility committee.”

The South-Korean tech company is also evaluating “potential benefits and feasibility of listing the company’s shares on additional international exchanges.” This sort of review could take as long as six months, Samsung said.

“As determining the optimal structure is a highly complex undertaking involving important strategic, operational, legal, regulatory and financial considerations, the company has retained external advisors to conduct a thorough review of the optimal corporate structure,” the company said.

Though the roadmap has been chalked out, we hope that the transition gives back Samsung its lost name and stature.

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