Samsung Heavy, Samsung Engineering scrap merger deal on high share buy back costs

[SEOUL] Samsung Heavy Industries said on Wednesday it has decided to scrap a merger with Samsung Engineering because of the high costs of buying shares from shareholders who oppose the deal.

Shareholders against the merger have said they want to sell their stocks back to Samsung Heavy and Samsung Engineering at a combined 1.63 trillion Korean won (US$1.48 billion).

Samsung Heavy had planned to effectively absorb Samsung Engineering for about US$2.5 billion, as part of a series of restructuring at South Korea's largest conglomerate that has accelerated since the Samsung Group's elderly chairman was hospitalised in May.

REUTERS