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Samsung Heavy Industries CEO denies immediate merger attempt with Samsung Engineering
Collected
2016.08.18
Distributed
2016.08.19
Source
Go Direct
Samsung Heavy Industries chief executive Park Dae-young Wednesday said he will not re-seek a merger with Samsung Engineering immediately, rejecting the possibility of the integration of the two companies propelled by a new administrative act that gives various incentives for voluntary restructuring for the next three years.

“It would be best for the two entities to endeavor to survive independently,” Park said after a weekly meeting among CEOs of Samsung Group. Samsung Heavy Industries as previously announced plans to bolster capital by around 1 trillion won ($905 million) by issuing new shares to other Samsung Group units that already own stakes in the troubled shipbuilder in need of debt relief and immediate liquidity due to drought of orders from prolonged depression in oil prices and global economic slowdown. Samsung Engineering also resorted to rights offering and rescue from Samsung Group affiliates in February.

Yet the merger option remains open, he said.

“It is true that we need some technology of Samsung Engineering,” he said.

The two companies negotiated a merger in September 2014 but dropped the plan in the face of opposition from shareholders. Rumors have continued to swirl that the two would eventually be combined into one to overcome respective business challenges and gained grounds after the so-called One Shot Act designed to facilitate and promote corporate restructuring took effect for a three-year period.

By Kang Young-woon

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