A judge at the Seoul Central District Court acquitted Lee Jae-yong, the chairman of the board of directors of the Samsung Group, on charges of stock price manipulation and accounting fraud. About this informs Bloomberg.
The charges related to the disputed legality of the merger of two subsidiaries of Samsung – “Samsung C&T Corp.” and Cheil Industries Inc., which took place in 2015. Prosecutors said the deal helped strengthen Lee’s control over the holding company. They demanded a five-year prison sentence and a fine of $376,000 for him.
However, the court ruled that the prosecution failed to provide sufficient evidence that the merger was carried out in violation of the law or had the sole purpose of increasing Lee’s influence over Samsung Electronics. This decision was a significant victory for the company and its executive, as it removed the legal uncertainty that affected the management of the corporation.
At the same time, Samsung is facing tougher competition in the market as its main rival, SK Hynix, has overtaken the company in the production of artificial intelligence chips. This has a negative impact on the profitability of Samsung’s semiconductor business and raises concerns about its future growth.
