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Samsung’s de facto holding company plans initial public offering

June 3, 2014, 12:32 PM UTC
Photograph by Justin Sullivan — Getty Images

Samsung Everland, the effective holding company of the South Korean-technology company and affiliates, is planning an initial public offering by the beginning of next year in an effort to consolidate the family’s ownership as the chairman and family patriarch’s health falters.

The company said it plans to go public by the first quarter of 2015. Samsung Everland will list in Korean and expects to pick managers for the IPO this month, according to a company spokesman.

Samsung Everland has a wide range of businesses, from a fashion company to an amusement park and golf resorts. It includes ownership of Samsung Electronics, Asia’s biggest technology company, through a patchwork of complex shareholding companies. The web of cross-shareholdings allows the family-run chaebol, a South Korean form of business conglomerate, to control their various groups while holding only small stakes.

The founding Lee family owns a combined stake of only 1.53% in the Samsung Group while maintaining control of 49.7% of the group’s 74 companies, according to a Korea Fair Trade Commission report last year.

The chairman, Lee Kun-hee, 72, suffered a heart attack in May and has been hospitalized since. The public offering could help speed the transition of ownership to his son Jay Y. Lee and daughters Lee Boo-jin and Lee Seo-hyun.

The younger Lee is Samsung Everland’s largest shareholder with a 25.1% stake as of the end of March and currently serves as the vice chairman of Samsung Electronics. The two daughters each held 8.37% Samsung Everland shares while the elder Lee held 3.72%.