43 Trillion Won in Treasury Stocks Cancelled by Major Conglomerates in 3 Months... Samsung Electronics’ Controlling Power Falls Below 20%

CEO Score Analyzes Changes in Controlling Power Among Listed Conglomerates

Amid a surge in treasury stock cancellations following the third amendment to the Commercial Act, it has been revealed that major conglomerates decided to cancel treasury stocks worth as much as 43 trillion won in just the first quarter of this year. This figure is three times the total amount of treasury stock cancellations for the entire previous year.

On April 21, CEO Score, a corporate data research institute, announced the results of its survey on changes in treasury stock cancellation volumes and subsequent changes in controlling power among 73 business groups (with a total of 339 affiliated listed companies) that are subject to public disclosure designations in 2025 and have both an owner and listed affiliates. The results showed that, among the 339 listed companies, a total of 60 companies decided to cancel treasury stocks in the first quarter of this year, with the total cancellation amounting to 42.5207 trillion won. This represents a sharp increase of 220.1% compared to last year's annual cancellation volume of 13.285 trillion won. However, the cancellation amount was calculated based on the closing price on the day before the board resolution, meaning the impact of this year's stock price increases was largely reflected.

The company with the largest volume of treasury stock cancellations this year is Samsung Electronics, at 14.8994 trillion won. It is followed by SK Hynix (12.24 trillion won), SK (4.8343 trillion won), and Samsung C&T (2.3269 trillion won). Notably, the combined treasury stock cancellation volume of Samsung Electronics and SK Hynix reached 27.1394 trillion won, accounting for 63.8% of the total volume for this year.

If treasury stocks are cancelled as planned, the company projected to see the largest decline in controlling power is Taekwang Industrial. The company’s controlling power is expected to decrease by 24.41 percentage points, from 78.94% before the cancellation to 54.53% after. SK is also projected to see its controlling power fall by 18.34 percentage points, from 50.21% to 31.87%, after the cancellation. SK plans to cancel 20.3% out of its 24.80% treasury stock holdings by January 2027, while the remaining 4.5% will reportedly be used for employee compensation. As of the end of last month, SK had the highest ratio of treasury stock holdings (based on common shares) among listed companies within large business groups.

In particular, Samsung Electronics will see the controlling power of its owner (largest shareholder's stake) fall below 20% after the treasury stock cancellation. As of the end of March this year, Samsung Electronics' controlling power was at 21.91% (treasury stock 2.21%, largest shareholder 19.71%). However, after cancelling 1.24% of its treasury stock earlier this month, the figure dropped to 19.95%, effectively breaking the 20% threshold. Samsung Electronics plans to dispose of the remaining treasury stocks for employee compensation purposes by the date of the regular shareholders’ meeting in 2027.

This survey was conducted to examine future trends in controlling power based on the status of treasury stock holdings and the shareholding ratios of largest shareholders and related parties at major conglomerates as of the end of March. The controlling power of listed companies was calculated by dividing the sum of shares held by the largest shareholder, related parties, and treasury stock by the total number of issued shares. After treasury stock cancellation, controlling power was calculated by dividing the shares held by the largest shareholder and related parties by the number of shares issued after the cancellation.

With the implementation of the third amendment to the Commercial Act last month, which made treasury stock cancellation mandatory, listed companies are now required to cancel treasury stocks they currently hold within 18 months. However, exceptions can be made if treasury stocks are needed for employee compensation or business purposes. In such cases, companies may retain or dispose of treasury stocks with shareholder meeting approval by submitting a plan for treasury stock retention or disposal.

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