Samsung SDI Co., a battery making unit of South Korea’s top conglomerate Samsung Group, will have to dispose 4.04 million additional shares in its sister firm Samsung C&T Corp. worth more than 500 billion won ($465 million) by September at the latest to comply with revised regulatory requirement.

The Fair Trade Commission on Thursday decided on the order after holding reviews that concluded Samsung SDI must dispose of all of its stakeholding in Samsung C&T that was achieved through the merger of Samsung C&T and Cheil Industries in 2015 under stricter interpretation of the antitrust regulations.

Shares of Samsung C&T were down 2.68 percent as of 2:50 p.m. on Thursday at 127,000 won, and Samsung SDI down 8,000 won at 203,000 won.

Samsung C&T merger designed to strengthen the grip of Samsung corporate empire heir Jay Y. Lee proves to be dear for the country’s biggest conglomerate. Lee is behind bars on charges of bribing impeached President Park Geun-hye in return for various government favors to facilitate the merger.

Cross-shareholding management structure allows affiliated companies to hold shares in each other based on a circular structure, allowing the conglomerate owner to have absolute control over the affiliates.

The FTC under former outspoken critic of chaebols came to judgment that under a stricter guideline that prevents new cross-affiliate shareholding through reorganization, Samsung SDI must not hold onto any stake in Samsung C&T.

Samsung SDI retains 4,042,758 shares in Samsung C&T worth 527.6 billion won on Wednesday’s closing price. In total, it would be disposing all 9,042,758 shares, including 5 million shares that were already disposed by Samsung SDI in 2015.

The FTC plans to inform the latest revision to Samsung Group once confirmed, and give the conglomerate six months of grace period, leaving Samsung SDI with up to September to dispose the shares.

By Seok Min-soo and Lee Eun-joo

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