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Two Samsung units to sell group firm's shares, as South Korea curbs cross-ownerships
[SEOUL] Two Samsung Group affiliates said on Thursday they are selling their entire stakes worth a combined US$867 million in Samsung C&T Corp, as South Korea's biggest conglomerate faces government pressure to unwind group cross-shareholdings.
The moves follow a similar stake sale in Samsung C&T, the group's de facto holding company, by another Samsung affiliate earlier this year, as the government forces big business groups to improve opaque ownership structures.
Samsung Fire & Marine Insurance said in a regulatory filing that the sale of 2.6 million shares in C&T was to improve its asset management. And Samsung Electro-Mechanics said in a separate filing it also decided to unload about 5 million shares in Samsung C&T to secure funds for investments and improve its balance sheet.
The shares will be sold in the stock market as block trades, they said.
Samsung Group is controlled through a web of circular shareholdings between companies such as Samsung C&T, Samsung Life Insurance and Samsung Electronics .
Critics have said the structure has enabled the family of Samsung heir Jay Y. Lee to retain control of the companies in the conglomerate, especially crown jewel Samsung Electronics, with minimum investments.
Earlier this year, Samsung SDI sold its shares in Samsung C&T.
Samsung C&T shares closed up 4 per cent, while Samsung Elec-Mech was down 3.3 per cent versus the wider market's 0.63 per cent rise.