Dividends and South Korea’s top court clears Samsung chair in case over merger

In every country, what is in the national interest is an issue. From an outsider, the answer seems confusing, because the laws do not seem to be applied equally. However, if the desired national interest is successful, then the results could be construed as the ends justifies the means.

In an article by Joyce Lee and Heekyong Yang of Reuters, the South Korean top court cleared Samsung Electronics Chairman Jay Y Lee of accounting fraud and stock manipulation removing a long-running legal risk for the country’s biggest company.

Samsung Electronics is the world’s top memory chip and number two smartphone maker. It is part of the Samsung Group is the most successful family-run conglomerate which helped Korea transform after WW II to a leading global economy.

The court case cleared Mr. Lee for charges related to two Samsung affiliates, Samsung C&T and Cheil Industries, which prosecutors said was designed to cement Mr. Lee’s control of the tech giant. The merger was $8 billion in 2015.

Analysts said the ruling clears a layer of legal uncertainty, which could be a long-term positive for the company.

Samsung’s lawyers said they were sincerely grateful to the court for its decision and added, the merger was legal.

The Korean Enterprise Federation said the ruling removes a major legal burden for Samsung and comes at a time of intensifying global competition in high-tech industries such as AI and semi-conductors.

Linking to dividend paying stocks, every profitable company gets sued and that is why they have legal staff in house and on call. The legal system takes time and sometimes companies go into the grey area. In this case, there was a disagreement over a $8 billion merger because one can easily imagine that given Mr. Lee’s pardon from a former President of the Korea and the prominence of the Lee family in Korea, the case had to be very good, or it would not have gone forward. Many profitable companies that can pay dividends, the relationship between the President and government officials means the case has to be extra airtight to go forward, it is just a fact of life.

There are more questions than answers, till the next time – to raising questions.

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