Billionaire Lee Fights Back Relatives Over Samsung Shares
Seokyong Lee/Bloomberg
Lee Kun Hee, chairman of the Samsung Group.
Lee Kun Hee, chairman of the Samsung Group. Photographer: Seokyong Lee/Bloomberg
May 30 (Bloomberg) -- Sandy Shen, an analyst at Gartner Inc. in Shanghai, talks about Samsung Electronics Co.'s new Galaxy S III smartphone and how it compares to Apple Inc.'s iPhone 4S. Shen speaks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
May 21 (Bloomberg) -- Charles Kim, a New York-based director at Mirae Asset Securities Co., talks about the outlook for South Korean stocks, Samsung Electronics Co.'s financial performance and his investment strategy. Kim speaks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
May 14 (Bloomberg) -- Andrew Griffiths, managing director for the U.K. and Ireland at Samsung Electronics Co. Ltd., talks about the new Galaxy S3 smartphone. He speaks with Bloomberg Television's Alex Court in London. (Source: Bloomberg)
During his long and controversial career, Samsung Electronics Co. (005930) Chairman Lee Kun Hee has transformed his family’s dried-fish and produce company into the world’s biggest maker of TVs and mobile phones, challenging Apple Inc. (AAPL) and Sony Corp. (6758) in the process. Now he must contend with feuding siblings.
Billionaire Lee, 70 years old and South Korea’s wealthiest citizen, is facing down lawsuits that his older brother and sister are waging in an attempt to win a slice of the family wealth. Lee Byung Chul founded what is today South Korea’s biggest business group in 1938 and died in 1987 without leaving a will, casting a shadow over the $153 billion electronics company’s future.
The siblings’ demand for at least an $850 million stake in the group that generates about 20 percent of South Korea’s gross domestic product threatens to be a costly distraction at a time of intense industry competition. The civil trial started today.
“He has grown Samsung to the point where Korea is called ‘Republic of Samsung,’” said Park Hyun Goon, author of “Lee Kun Hee’s Agony,” a book about Samsung succession published this year. “How would it make him feel if a share of that is taken away by his siblings or if his company goes down?”
Samsung vs. Apple
The rancor comes as Samsung Electronics challenges Cupertino, California-based Apple, its biggest customer and its adversary in patent lawsuits on four continents, after selling one of almost every four mobile phones in the first quarter. Samsung earned 7.64 percent of its revenue from selling chips, displays and other products to the iPhone maker.
At the same time, more than 30 cases concerning patents and design are pending from Paris to San Francisco between the two companies, which traded leadership positions in the $219 billion global smartphone market in the past three quarters.
Samsung ended Espoo, Finland-based Nokia Oyj (NOK1V)’s 14-year run as the global leader in mobile phones last quarter. Samsung shipped 93.5 million handsets of all kinds, compared with 82.7 million for Nokia, researcher Strategy Analytics said last month. Apple ranked third.
“The risk of losing your edge during these times is real,” Matt Walker, senior analyst at market researcher Ovum, said in an e-mail. “Companies that are driven by innovation, as Samsung should be, can’t afford much downtime to deal with this kind of turbulence.”
Family Feud
The family feud drags Lee, a lung cancer survivor, back into a courtroom following a series of run-ins with the law. He was convicted of paying bribes to former Presidents Chun Doo Hwan and Roh Tae Woo in 1996 before receiving a pardon from then-President Kim Young Sam a year later.
Lee quit as chairman of the group and electronics company in 2008 after being charged with tax evasion. He received another presidential pardon in 2009 and reassumed his post running Samsung Electronics in 2010.
“Ironically, the biggest risk to Samsung’s corporate governance is Lee Kun Hee himself,” said Chae Yi Bai, a researcher at the Center for Good Corporate Governance, a Seoul- based private institute monitoring South Korean conglomerates. “The family dispute again highlights this inherent problem of Samsung.”
The feud became public in February when brother Lee Maeng Hee, 80, and sister Lee Sook Hee, 76, filed suits at the Seoul Central District Court demanding shares held in Samsung Life Insurance Co. (032830) by their younger sibling. Samsung Life is the second-largest shareholder of Samsung Electronics after the company itself, so whoever controls the insurance company controls Asia’s biggest consumer-electronics maker.
Not A ‘Dime’
Neither the brother nor sister has any role in the group. At today’s hearing in Seoul, their lawyer said the siblings were trying to regain wealth “they unfairly lost.”
“They aren’t unethical people who are only after money,” Kim Nam Geun said.
The chairman’s lawyer said the family patriarch repeatedly expressed his desire for Lee Kun Hee to take over the group.
“If not, how could there have been no dispute over the last 25 years?” Kang Yong Hyeon said. “It doesn’t make sense.”
The Lees didn’t attend. The next hearing is June 27.
Chairman Lee said he wouldn’t give a “dime” to his brother because inheritance matters had been settled by his father, according to media reports on April 17. He later apologized for publicly making the comments.
Richest Man
Chairman Lee holds 41.5 million shares, or about 21 percent, of Samsung Life, making him the largest shareholder, according to data compiled by Bloomberg. The elder brother wants 8.24 million of those shares and the sister wants 2.23 million shares, according to Yoon & Yang, the Seoul law firm representing them, valued at a combined $850 million.
The public holdings of South Korea’s richest man are valued at $8.6 billion, according to data compiled by Bloomberg. The family conglomerate, Samsung Group, controls more than 80 companies making armored vehicles and artillery guns for South Korea’s military, oil tankers, amusement parks and apartment complexes.
Handing over the 10.47 million shares to his siblings would mean the chairman no longer would be the largest investor in Samsung Life. In South Korea’s complex world of cross-holding of shares in companies, that could trigger a dispute over control of Samsung Electronics, Chae said.
“This could be a big problem for their overall governance,” he said.
‘So Much Name-Calling’
To avoid the battle, the chairman may opt to pay his siblings in cash or with other assets, Chae said.
Until now, the stock market hasn’t shown any concern. Samsung shares have advanced 16 percent this year and reached a record high 1.41 million won earlier this month. The shares have jumped more than 100-fold since Lee became chairman in 1987.
Samsung Electronics accounted for 44 percent of Samsung Group’s total revenue in 2011.
Chairman Lee hasn’t hinted of letting the family discord disrupt the business, telling local media May 2 he “won’t be involved in the issues related to the suits from now on and I will only focus on growing Samsung Group.”
“All these chaebol families try to maintain as much privacy as possible,” said Tom Coyner, Seoul-based president at Soft Landing Consulting, a business-advisory firm.
“Chaebol” is the Korean word for family-controlled conglomerate, such as Samsung and Hyundai Group.
“It’s remarkable that so much name-calling has been made in public,” Coyner said. “It shows that there’s a great amount of tension in the family.”
To contact the reporter on this story: Jun Yang in Seoul at jyang180@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
Vodafone Iceland implements FTS billing solution - telecomlead.com
Vodafone
Telecom Lead Europe: Vodafone Iceland has deployed the latest version of Leap Billing from FTS, a provider of billing, customer care and policy control solutions.
The implementation of the Leap Billing end-to-end billing and customer care solution enables flexible charging and billing for Vodafone's entire line of business, including mobile, fixed and broadband services.
"We found Leap Billing to be one of the most flexible, robust and cost-effective solutions available on the market. Thanks to FTS' Leap Billing we have increased the flexibility of our billing and have also increased our ability to create new and innovative services," said Ardis Bjork Jonsdottir, Billing Manager Vodafone Iceland.
The billing solution from FTS helps operators to reduce
the time and cost of any change requests, allowing billing to rapidly adopt new
services.
Using FTS' solutions Vodafone Iceland's back office is able to act at the speed of marketing and with a much lower total cost of ownership (TCO).
"This latest implementation at Vodafone Iceland is a
further vote of confidence in FTS' telecom billing solutions. Leap Billing
addresses the needs of convergent service providers such as Vodafone Iceland,
and supports them as they continue to offer innovative, cross-network services,"
said Yitzchak Feldman, FTS' Vice President of Sales & Marketing.
Vodafone Iceland is a convergent communication service provider, offering mobile, fixed, broadband internet and data services. FTS' Leap Billing software supports the operator's charging, billing and customer management needs, and is integrated with Vodafone Iceland's Microsoft Dynamics CRM system.
FTS claims its Leap Billing solution realizes substantial
reductions in OPEX and CAPEX while increasing customer satisfaction and retention.
Israel telecom operator TelZar 019 deploys FTS convergent billing and customer care solution
Recently, TelZar 019, a provider of international calling
services in Israel deployed FTS' Leap Billing solution. TelZar 019 offers
prepaid and postpaid communications services to a growing number of customers.
Samsung chairman set to fight back in tussle for shares - BBC News
The chairman of Samsung Electronics, Lee Kun-hee, will this week defend three lawsuits from family members claiming ownership of $1bn (£642m) worth of the company's assets.
Mr Lee, who is South Korea's richest man, will go up against his older brother and sister in court.
Samsung Electronics, part of Samsung Group, is the world's largest electronics company by revenue.
The fight comes as the company is also facing stiff competition from rivals.
Samsung Group is a family controlled conglomerate that produces about one fifth of South Korea's total exports.
It has annual sales of about $234bn and includes a wide range of businesses, including shipping, engineering and smartphones.
The family feud for shares also involves the group's insurance unit, Samsung Life, as well as Samsung Electronics.
Analysts have said Mr Lee is more likely to want to work the matter out quickly with his siblings than continue the ownership wrangle.
"Lee (Kun-hee) would prefer to settle in cash because losing some of this stake in Samsung Life could spark a bigger ownership restructuring in key Samsung companies," said analyst Jun Yon-ki from Hyundai Securities.
Samsung is currently fighting its main customer and rival, Apple, in more than 30 court cases over design and patents.
Who wants what?Lee Kun-hee's older brother Maeng-hee wants shares in Samsung Life and Samsung Electronics.
His older sister Lee Sook-hee also wants shares in Samsung Life and Samsung Electronics.
Together, the two siblings are aiming for about 25% of their younger brother's stake in Samsung Life, which is the majority shareholder of Samsung Electronics - the star of the Samsung Group.
Maeng-hee has argued that his younger brother inherited about $3.8bn of shares from their father without telling other family members who may have been entitled to some of the shares.
The third lawsuit has been filed by other relatives seeking a small slice of Samsung Life shares.
Lee Kun-hee is widely credited with transforming his family's company into one of the world's biggest makers of televisions and mobile phones. Lee's father, Byun-chul, founded the group in 1938 but died without leaving a will.
Vodafone executive died after working his way through hotel minibar - Daily Telegraph
The executive's body was flown back to Britain after his death and a post mortem revealed he had died of alcohol poisoning compounded by heart problems.
In the aftermath of his death shocked colleagues at the mobile phone company clubbed together to raise almost £3,500 pounds for the British Heart Foundation in his memory.
A statement posted on their charity appeal website read: "Mark Breslin, our commercial leader in the M2M team, passed away whilst on Vodafone business in Seattle.
"Mark was one of the driving forces in our M2M business who brought huge energy and personality to everything he did.
"He will be greatly missed by us all so please dig deep and donate now to his family's chosen charity."
His distraught wife Imogen listened quietly as the details of his tragic death were read out but asked no questions during the short hearing today.
Coroner Andrew Bradley, sitting in Alton, Hants., recorded a verdict of misadventure after finding Mr Breslin had not intended to drink himself to death at the posh hotel.
A post mortem returned the cause of death as Ethanol Intoxication after tests revealed his blood contained up to five times the drink drive limit.
Prior to his death he lived in a £450,000 pounds detached home in Foxs Furlong, Chineham, Basingstoke, Hants., with Imogen. The couple had two children.
Finance ministry identifies more deals to be taxed - Livemint.com
The finance ministry has identified several deals apart from the Vodafone-Hutchison transaction that will come within the tax net after the retrospective amendments introduced in this year’s budget are approved, a top finance ministry official said.
These deals, including the Vodafone transaction, are not covered under any double tax-avoidance treaties (DTAA) that India has with other countries and are likely to yield the government revenue of around `35,000-40,000 crore.
The move aims to target companies that take money out of their Indian subsidiaries in tax-efficient ways or that have acquired an Indian company or an Indian asset.
“There are around 10 companies apart from Vodafone which would be impacted by retrospective clarificatory amendment,” said the official who didn’t want to be named. “We will raise tax due from them soon.”
According to the official, these deals include Euro Pacific Security Ltd’s purchase of a 22% stake held by Essar’s Mauritius arm in Vodafone Essar; Accenture Services transaction related to its nearly 100% holding in Accenture India through Mauritius-registered entity Beaumont Development Centre Holdings; Sab Miller’s purchase of the Indian assets of Foster’s Australia; Sanofi Pasteur Holdings’ acquisition of Shantha Biotech from another French firm; Tata Industries’ deal involving AT&T’s stake in the company that is now Idea Cellular Ltd; the Sesa Goa transaction involving the purchase of Cairn UK’s stake in Cairn India; and Cyprus-based Richter Holdings Ltd, along with Mauritian company West Globe Ltd, acquiring the holding of UK-registered Finsider International Co., which held a 51% stake in Sesa Goa.
NDTV reported that Euro Pacific Security and Pan Asia, one of the companies mentioned by the official, have already paid taxes as per the income tax department’s demand. It cited a ministry official who wasn’t identified.
A Tata spokesperson said the matter was sub judice and declined to comment. A Sanofi spokesperson said the company is reviewing “the latest developments in the Indian tax law. It is too early for us to make any further comment at this stage”. Mint wasn’t able to reach the other companies on the list late on Wednesday.
Earlier this month, finance minister Pranab Mukherjee had clarified that retrospective amendments to the Income Tax Act in the budget would not override the provisions of the DTAA that India has with 82 countries. Mukherjee had added that retrospective clarificatory amendments would not be used to reopen cases in which assessment orders have been finalized before 1 April of this year.
On the Vodafone arbitration notice sent to the Indian government, the official said the government has replied to the company stating that the notice was premature.
“We have replied to Vodafone that there is no cause of action because no law has been amended,” the official said. “It is premature on behalf of Vodafone.”
On 18 April, Vodafone, through its Dutch subsidiary Vodafone International Holdings BV, sent the letter of dispute to the Indian government as the first step to initiate international arbitration proceedings under the bilateral investment protection agreement (BIPA) signed by the Netherlands and India. The government had set up an inter-ministerial group to finalise the government’s response.
Vodafone International Holdings BV bought the Indian business operations of Hutchison Telecommunications International Ltd (HTIL) through the sale of a Cayman Islands-based firm called CGP Investments (Holdings) Ltd, a unit of HTIL, also incorporated in the Cayman Islands. The tax department estimated the phone company’s tax liability at more than `11,000 crore. Vodafone and the Indian tax authorities went to court to resolve the issue.
In a 20 January verdict, the Supreme Court ruled in favour of the telecom company, saying the tax department did not have the jurisdiction to tax the transaction.
Following the judgement, the government brought in a retrospective amendment to bring similar transactions under the tax net.
remya.n@livemint.com
PTI contributed to this story.
Vodafone Iceland deploys FTS end-to-end billing solution; FTS' Leap Billing supports Vodafone's mobile, fixed and broadband services - TMCnet
(M2 PressWIRE Via Acquire Media NewsEdge) Herzliya, Israel -- FTS, a global provider of billing, customer care and policy control solutions for communications and content service providers, today announced that Vodafone Iceland has implemented the latest version of Leap Billing, FTS' comprehensive end-to-end billing and customer care solution to enable flexible charging and billing for Vodafone's entire line of business, including mobile, fixed and broadband services.
Vodafone Iceland is a convergent communication service provider, offering mobile, fixed, broadband internet and data services. FTS' Leap Billing software supports the operator's charging, billing and customer management needs, and is integrated with Vodafone Iceland's Microsoft Dynamics CRM system.
"We found Leap Billing to be one of the most flexible, robust and cost-effective solutions available on the market," said Ardis Bjork Jonsdottir, Billing Manager Vodafone Iceland. "Thanks to FTS' Leap Billing we have increased the flexibility of our billing and have also increased our ability to create new and innovative services." Leap Billing helps operators to dramatically reduce the time and cost of any change requests, allowing billing to rapidly adopt new services. Using FTS' solutions Vodafone Iceland's back office is able to act at the speed of marketing and with a much lower total cost of ownership (TCO).
"This latest implementation at Vodafone Iceland is a further vote of confidence in FTS' telecom billing solutions," said Yitzchak Feldman, FTS' Vice President of Sales & Marketing. "Leap Billing addresses the needs of convergent service providers such as Vodafone Iceland, and supports them as they continue to offer innovative, cross-network services." Leap Billing is a flexible, convergent billing, customer care and online charging solution that realizes substantial reductions in OPEX and CAPEX while increasing customer satisfaction and retention. Based on FTS' patented business-control technology (DoTree(TM)), the solution captures events delivered over single or multiple network technologies in real-time and responds to them based on a preconfigured set of business policies or actions. This flexibility and ease of use enables the service providers' billing to become a business enabler for offering new marketing plans or services, with a rapid time-to-market.
About Vodafone Iceland Vodafone Iceland is a multi-play service provider offering mobile phone, fixed, internet and data services. Vodafone Iceland focuses on the needs of its customers and offers a wide portfolio of products to both individuals and companies. Vodafone Iceland is a key player on the Icelandic telecom market and the Vodafone mobile network covers over 99% of populated areas in Iceland as well as big part of the Icelandic wilderness.
About FTS FTS provides billing, customer care and policy control solutions that have greater flexibility and provide greater independence for communications and content service providers, resulting in a dramatically lower total cost of ownership (TCO). As the first billing company to provide policy management, by analyzing every transaction from a business standpoint, FTS offers a complete package of solutions and can service both growing and major, established providers.
FTS deploys its full range of end-to-end and add-on telecom billing and policy control services to customers in over 40 countries and implements solutions in wireless, wireline, cable, broadband, machine-to-machine (M2M) and content markets including multiple convergent installations. By providing solutions and service to telecommunications providers globally, FTS is helping to reduce the total cost of ownership of billing and policy control.
Further information is available at http://www.fts-soft.com/.
For further information please contact: Joshua PR: Kate Gordon, Tel. +44 7980 921961 , kate.gordon@joshuapr.com FTS: Moshe Peterfreund, Tel. +972-9-952-6500 , press@fts-soft.com CONTACT: Kate Gordon, Joshua PR Tel: +44 (0)7980 921961 , e-mail: kate.gordon@joshuapr.com Moshe Peterfreund, FTS Tel. +972 9 952 6500 e-mail: press@fts-soft.com ((M2 Communications disclaims all liability for information provided within M2 PressWIRE. Data supplied by named party/parties. Further information on M2 PressWIRE can be obtained at http://www.presswire.net on the world wide web. Inquiries to info@m2.com)).
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