Samsung Heir's Indictment Could Put Deals, Big Decisions On Hold
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The indictment of Samsung Electronics Co. de facto chief Jay Y. Lee and four other top executives on bribery and embezzlement charges threatens the company’s ability to make major strategic decisions, including acquisitions and management changes.
While the world’s biggest maker of mobile devices has capable managers who will, as before, continue to roll out new products and expand the business, any acquisitions, major management shuffles and changes to the corporate structure will probably have to wait until Mr. Lee’s legal issues subside.
The vice chairman is accused of directing tens of millions of dollars to entities controlled by a confidante of President Park Geun-hye, in return for government support of a 2015 merger that cemented his control of the group. The indictment is yet another blow to the Suwon, South Korea-based company as it tries to regain its footing following the Note 7 debacle last year and the prosecution of the chaebol’s heir.
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