[Samsung on the Rise Again] Return of the Chairman Signals Aggressive Investment... Large-Scale M&A Restart

Samsung Plans 240 Trillion KRW Investment Over 3 Years
Approximately 50 Trillion KRW Expected for System Semiconductors
Over Half of 60 Trillion KRW Overseas Investment Anticipated for M&A
Growing Expectations for Large-Scale M&A to Secure New Business Growth Engines

[Asia Economy Reporter Su-yeon Woo] With the return of Samsung Electronics Vice Chairman Lee Jae-yong accelerating decision-making speed, expectations for large-scale mergers and acquisitions (M&A) within the Samsung Group are also growing. Samsung, which has set an aggressive investment policy worth 240 trillion won over the next three years, is expected to soon announce detailed investment plans including M&A one after another.

According to the business community and Samsung on the 25th, of the 240 trillion won (180 trillion won domestic, 60 trillion won overseas) that Samsung Group plans to invest over the next three years (2021?2023), it is estimated that 150 trillion won will be invested solely in the semiconductor sector, with around 50 trillion won allocated specifically to the system semiconductor division.

Additionally, it is forecasted that more than half of the 60 trillion won overseas investment will be used for strategic overseas M&A. Earlier, Samsung Electronics expressed its intention to carry out meaningful M&A within three years in new growth areas including semiconductors, automotive electronics, 5G, and artificial intelligence (AI). Expectations are rising that Samsung’s ‘M&A DNA,’ which has been dormant since the acquisition of automotive company Harman in 2017 and the absence of major M&A deals since then, will awaken.

Within the industry, automotive semiconductor companies such as NXP are being considered as potential investment targets, but recent acquisition price increases due to improved market conditions suggest it may not be easy. There is also a strong possibility that Samsung will execute large-scale M&A in breakthrough innovative industrial sectors beyond the traditional analog semiconductor field.

Meanwhile, the overall investment speed and disclosure of concrete strategies by Samsung Group affiliates are expected to accelerate. In this announcement, Samsung Electronics stated that it will continue mid- to long-term investments in research and development (R&D) and infrastructure in the memory semiconductor sector, and will advance the execution of the planned 171 trillion won investment in system semiconductors by 2030.

In the rapidly changing semiconductor industry, investment is directly linked to survival. Recently, global semiconductor market competition has expanded into a national rivalry involving governments of various countries. Samsung Electronics’ direct competitors, Intel and TSMC, are also fully committed to securing market leadership through aggressive investment policies.

In response, Samsung is countering with an active investment strategy. The industry expects Samsung to invest 40 to 50 trillion won solely in system semiconductors over the next three years, executing more than twice the investment scale of the previous three years (20 trillion won) ahead of schedule. Dong-won Kim, a researcher at KB Securities, said, "Early investment in non-memory semiconductors is a strategy to secure technological competitive advantage over rivals by mass-producing 3nm products with the new Gate-All-Around (GAA) structure starting next year."

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