Samsung affiliates' shares drop on order to cut cross-holdings

Seoul

SAMSUNG GROUP affiliates fell in Seoul after South Korea's antitrust regulator ordered the nation's largest conglomerate to cut cross-shareholdings by March or face possible penalties.

Samsung C&T Corp slumped as much as 5.2 per cent and Samsung SDI Co dropped 1.8 per cent. The Fair Trade Commission ruled the chaebol must address a complex web of shareholdings involving its affiliates and C&T, the de facto holding company formed through the deal in September. The agency's decision presents one more headache for the conglomerate as it tries to turn around Samsung Electronics Co, which is losing ground in smartphones and facing intense competition in semiconductors. The agency's push may also increase pressure on the conglomerate to sell stakes in key affiliates, potentially weakening the Lee family's control.