Prosecutors Summon Former Samsung C&T CEO Kim Shin for Investigation... Intensifying Probe into Higher-Ups in Merger Allegations

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyung-min] The prosecution appears to have officially launched an investigation into the top executives of Samsung to clarify suspicions surrounding the merger of Samsung C&T and Cheil Industries.

The Anti-Corruption Investigation Division 4 of the Seoul Central District Prosecutors' Office (Chief Prosecutor Lee Bok-hyun) summoned Kim Shin (63), former CEO of Samsung C&T, for questioning on the morning of the 7th. Kim arrived at the prosecutors' office around 9:20 a.m. and entered the interrogation room without responding to reporters' questions such as "Do you think the merger ratio was fair?"

The prosecution is reportedly questioning Kim about the circumstances under which Samsung C&T's company value declined just before the 2015 merger with Cheil Industries. The prosecution suspects that Samsung C&T deliberately lowered its company value by reducing performance figures such as overseas construction orders to create a merger ratio favorable to Samsung Electronics Vice Chairman Lee Jae-yong. Through this, Samsung C&T was merged at a ratio nearly three times more favorable to Cheil Industries, where Lee was the largest shareholder at the time. The prosecution views this series of events as the result of the group moving its affiliates to facilitate Lee's smooth succession of management rights.

Starting with Kim Shin, the prosecution plans to sequentially summon other top executives of the group at the time, including Jang Choong-ki (66), Deputy Head of the Future Strategy Office, and Choi Ji-sung (69), Head of the Future Strategy Office, to verify the extent of their involvement in decision-making. Since receiving a complaint from the Securities and Futures Commission under the Financial Services Commission in November 2018 regarding accounting fraud allegations against Samsung Biologics, the prosecution has been conducting related investigations for one year and two months. The accounting fraud allegations against Samsung Bio, which triggered the merger and succession suspicion investigations, are practically concluded, with only the judicial processing of CEO Kim Tae-han (63) and others remaining.

This content was produced with the assistance of AI translation services.