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HomeBusinessSamsung chief Lee Jae-yong cleared of financial crimes in 2015 merger case.

Samsung chief Lee Jae-yong cleared of financial crimes in 2015 merger case.

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The South Korean court ruled on Monday acquitted Samsung Electronics Chairman Lee Jae-yong, stating the prosecution had failed to demonstrate the merger between Samsung C&T and Cheil Industries was illegally conducted to strengthen Lee’s control over Samsung Electronics. The activists, progressive politicians, and commentators criticized the ruling, contending the court had shown bias towards Lee and neglected the interests of shareholders and pensioners. The ruling was regarded as a setback for years of efforts to reform the management culture of South Korea’s familial conglomerates and their ties with the government.

Lee, officially appointed chairman of Samsung Electronics in 2022, had previously served 18 months in prison following a conviction in 2017 related to separate bribery charges associated with the 2015 deal. He was released on parole in 2021 and pardoned by President Yoon Suk Yeol in 2022, which added to a history of leniency towards major white-collar crime in South Korea. There were also concerns over how the national pension fund’s stake in Samsung C&T fell by hundreds of millions of dollars after Park pressured the National Pension Service to back the deal. Some shareholders opposed the 2015 merger, stating it favored the Lee family and hurt minority shareholders.

The court’s ruling was met with criticism and was seen as a setback for efforts to reform the management culture of family-owned conglomerates in South Korea. There were also concerns over the relationship between business and politics as well as the protection of shareholders’ interests. Finally, the ruling was met with further skepticism due to previous events and the impact on minority shareholders.

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