Samsung Appeals to Media: "Management Normalization Essential to Overcome Crisis"

[Image source=Yonhap News]

[Asia Economy Reporter Kiho Sung] As Samsung Vice Chairman Lee Jae-yong faces the risk of detention again over the Samsung C&T-Cheil Industries merger and accounting issues at Samsung Biologics, the company has issued an appeal.

On the 7th, Samsung stated in a "Public Appeal to the Media," "Regardless of the outcome from the prosecution, Samsung will respect the judicial decisions of the courts and the investigative review committee," but added, "We will actively clarify certain matters to ensure objective and reasonable judgments by the courts and the prosecution's investigative review committee."

In the appeal, Samsung emphasized that the merger between Samsung C&T and Cheil Industries was conducted legally in accordance with relevant laws and procedures, and that Samsung Biologics' accounting treatment was handled in compliance with international accounting standards. Based on this, Samsung refuted the prosecution's claim that the stock price was manipulated to facilitate the merger, stating it is not true.

Samsung also requested, "There have been continuous speculative reports in some media outlets that have not been verified or whose sources are questionable, including articles presuming guilt. We ask that unfounded and excessive reporting not based on facts be restrained."

Furthermore, Samsung stressed, "Due to the prolonged prosecution investigation, normal management has been constrained, and amid this, external uncertainties such as the COVID-19 pandemic and the US-China trade dispute have intensified," adding, "This crisis is unprecedented even for Samsung."

Samsung expressed, "We feel ashamed and sorry that Samsung, which should be a key player in overcoming the economic crisis caused by the prolonged COVID-19 situation, is instead facing a management crisis and causing concern to the public," and appealed, "Please help Samsung fulfill its role in overcoming the crisis of the Korean economy."

Earlier, the prosecution had filed an arrest warrant on the 5th, alleging that Vice Chairman Lee planned and executed the merger of affiliates and accounting fraud to secure management succession and strengthen group control during the Samsung C&T-Cheil Industries merger process.

Judge Won Jeong-sook of the Seoul Central District Court, in charge of warrants, will conduct the detention hearing (warrant review) for Vice Chairman Lee at 10:30 a.m. on the 8th.