Lee Jae-yong Visits the UK... Attention Focused on 'ARM' M&A Decision

System Semiconductor Design... An Unmissable 'Partner'

Samsung Electronics Vice Chairman Lee Jae-yong is greeting employees during his visit to the Samsung Engineering Dos Bocas refinery construction site in Mexico on the 10th (local time). (Photo by Samsung Electronics) [Image source=Yonhap News]

[Asia Economy Reporter Moon Chaeseok] It has been confirmed that Samsung Electronics Vice Chairman Lee Jae-yong visited the United Kingdom, drawing attention to whether discussions related to Samsung Electronics' potential semiconductor intellectual property (IP) acquisition target, ARM, will accelerate. Other companies mentioned include Germany's major automotive, industrial, and power system semiconductor company Infineon, and the Netherlands' automotive semiconductor company NXP.

According to business circles on the 17th, the chartered plane carrying Vice Chairman Lee arrived in the UK the day before. Amid on-site management activities following the Liberation Day lottery and pardon under the banner of 'New Samsung,' as well as supporting efforts to host the '2030 Busan World Expo,' speculation continues that the UK visit is related to an M&A deal.

The market is naming ARM, Infineon, and NXP as candidates. Earlier this year, Samsung Electronics officially announced plans for large-scale M&A, with ARM consistently regarded as a leading candidate. ARM holds core chip design technology known as the 'brain' of IT devices such as computer central processing units (CPUs) and smartphone application processors (APs). The ARM-based AP market share exceeds 90%. Since ARM operates on a model of building semiconductor designs and earning revenue through licensing, it is an indispensable partner for Samsung Electronics, which is increasing its investment in system semiconductors.

Samsung Electronics ranks second in market share in the foundry (semiconductor contract manufacturing) business after Taiwan's TSMC, but its technological competitiveness in semiconductor chip design is considered relatively weaker. Samsung's mobile AP 'Exynos' is also based on ARM's design technology, but as of the second quarter, Samsung's global mobile AP market share stood at 7.8%, ranking fifth.

Ultimately, the focus is on whether the M&A will be completed within the year. Samsung has ample financial resources, with cash assets alone reaching 125 trillion won. On the 2nd (local time), Samsung Electronics Vice Chairman Han Jong-hee stated at Europe's largest home appliance exhibition 'IFA 2022' held in Berlin, Germany, that "a significant portion is underway" regarding large-scale M&A efforts.

Industry insiders cautiously speculate that Vice Chairman Lee may attend the funeral of the late Queen Elizabeth II alongside President Yoon Suk-yeol, who is scheduled to visit the UK on the 19th (local time). Samsung has supplied home appliances such as TVs, refrigerators, and washing machines to the British royal family since 2006. Samsung Electronics' UK branch issued a condolence statement on its website following the Queen's passing.

There is also speculation that Vice Chairman Lee will visit the United States next week before attending the court schedule related to the unfair merger of Samsung C&T and Cheil Industries on the 22nd. Given that Samsung Electronics is building a second foundry plant worth $17 billion (approximately 21 trillion won) in Taylor, Texas, attention is focused on whether Vice Chairman Lee will attend the groundbreaking ceremony.

Meanwhile, Vice Chairman Lee has been on a business trip to Latin America, including Mexico and Panama, since the 8th. He has been inspecting local business sites and requesting support from various governments for the '2030 Busan World Expo' bid.

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