South Korea’s powerful Lee family is fighting to maintain control of Samsung Group,
following the loss of charismatic patriarch and group chairman, Lee Kun-hee.
Let’s look at his legacy and the path ahead for the titan of tech.
Lee was the richest person in South Korea.
He helped grow the conglomerate his father built from a noodle trading business into a global powerhouse.
With assets worth $375 billion, Samsung Group's affiliates stretch from electronics and insurance to shipbuilding and construction.
Reuters calculated the group’s 2019 revenue was worth around 17% of the entire country’s GDP.
While praised for his leadership, Lee was no saint - and was convicted of bribery and tax evasion.
He and his empire were vilified for wielding huge clout, opaque governance and dubious transfers of the family wealth.
He leaves behind potentially thorny succession issues for the third generation.
Sprawling, family-run conglomerates are at the heart of South Korea’s transformation into one of the world’s biggest exporters.
They are known as chaebol - which means “wealth clique” in Korean.
Alongside Samsung, they also include the likes of LG and Hyundai.
Lee’s net worth was $20.9 billion, according to Forbes.
It’s unclear how his three children and wife will split his wealth,
an issue that led to family feuds at other chaebols.
His son Jay Y. Lee is heir apparent and the de-facto leader
- but has been embroiled in legal troubles of his own.
He served jail time for his role in a bribery scandal,
which triggered the impeachment of then-President Park Geun-hye.
Whether the Lee family can keep their grip on Samsung Group remains in question,
as they grapple with a series of obstacles.
These are some of the issues they face.
Firstly, there’s Samsung Electronics - the jewel in the conglomerate’s crown.
The family’s combined direct stake ownership is only 5.8%
- and that of Jay Y. Lee just 0.7%.
The family's outsized control is made possible through shareholdings in other group affiliates.
They’ll try to inherit the late chairman’s stake.
But they’re facing a hefty inheritance tax bill.
If the family inherits Lee’s stocks, the total is estimated to top over $9 billion.
That’s raised expectations for stake sales -
and a potential restructuring of the sprawling business empire.
Then - there’s legal hurdles.
Proposed legislation could force affiliate Samsung Life to sell about $20 billion in shares in Samsung Electronics.
That would cripple the Lee's family's grip on the chipmaker.
The passage of the law remains uncertain.
It could be unpopular with retail investors,
ahead of a presidential election in early 2022.