|Samsung Electronics Chairman Lee Jae-yong leaves the Seoul Central District Court on Feb. 5, 2024, after the court acquitted him in connection with the controversial 2015 merger of two Samsung affiliates./ Photographed by Park Sung-il
By AsiaToday reporter Lim Sang-hyuk
A Seoul court on Monday acquitted Samsung Electronics Chairman Lee Jae-yong, who was indicted on charges of unfairly merging Cheil Industries and Samsung C&T, and former and current Samsung executives and employees in the first trial, three years and five months after the indictment. The court judged that the merger at the time was not just about strengthening Lee’s management rights, but to overcome Samsung C&T’s poor performance and break stagnation in growth.
The Seoul Central District Court delivered the not-guilty sentence for Lee on charges of violating the Capital Markets Act and more. The ruling for Lee came with the acquittal of 13 other defendants, including former head of Samsung Group’s Future Strategy Office Choi Gee-sung.
“In a situation where Samsung C&T was looking for a solution, the merger was one of the options,” the court said. “The long-term investigation by the court has shown that the merger was carefully reviewed and carried out, and many documents were submitted to support it,” it added. Although the court said that it is true that Chairman Lee’s control over the group has increased due to the merger, it concluded that Lee’s succession as the group chairman or the solidification of his control of the group were not the sole purpose of the merger, nor was there any evidence showing that the merger inflicted financial losses on shareholders.
“None of the criminal charges in this case have been proven,” the court said.
The charges against Samsung’s Future Strategy Office, alleging misconduct during the merger process, were also not acknowledged. The prosecution claimed that the future strategy office spread false information, concealed crucial information, falsely publicized optimistic prospects, and manipulated stock prices to hide the disadvantages of Samsung C&T.
Lee’s side welcomed the not-guilty sentence. “I believe the verdict clearly confirms the legality of the Samsung C&T merger and Samsung Biologics’ accounting treatment. I would like to express my gratitude to the court for its wise judgment,” said Lee’s legal representative and senior attorney at Kim & Chang Kim You-jin.