Wedoany.com Report-Oct. 20, Samsung Electronics (005930.KS) announced in a regulatory filing that Chairman Jay Y. Lee’s mother, Hong Ra-hee, and his sisters, Lee Boo-jin and Lee Seo-hyun, plan to sell 17.7 million shares, representing a 0.3% stake valued at approximately 1.73 trillion won ($1.22 billion). The sale aims to cover inheritance tax and loan repayment obligations, according to the filing submitted to the Korea Exchange late Friday.

The logo of Samsung Electronics is seen at its booth during The 26th Semiconductor Exhibition 2024 in Seoul, South Korea, October 23, 2024.

Analysts note that the sale is part of the Samsung family’s ongoing efforts to manage inheritance taxes, estimated at around 12 trillion won, following the death of Samsung patriarch Lee Kun-hee in 2020. The transaction will be managed by Shinhan Bank under a trust contract and is expected to complete by next April.

Samsung shares have risen more than 48% since July, when the company announced a chip-supply deal with Tesla, and have secured other significant contracts, including with OpenAI. Investor expectations are also high for Samsung to supply high-bandwidth memory products to Nvidia (NVDA.O). The stock has gained over 84% this year, closing at 97,900 won on Friday, up 0.2%.

Park Ju-gun, head of corporate analysis firm Leaders Index, commented: “Samsung's 10 trillion won share buyback plan last year was aimed at protecting the stock value, which would help the Samsung family to secure funds for inheritance tax.” He added that with the share price approaching 100,000 won, the planned sale likely focuses on completing inheritance tax payments.

Park also noted potential market implications: “One disappointing aspect is that the owner family is selling shares at a time like this, which could dampen sentiment among retail investors. After all, Samsung Electronics is practically a ‘national stock,’ owned by about 5 million retail shareholders who have been eagerly watching the shares approach the 100,000-won mark after the recent rally.”

The sale underscores the dual focus of the Samsung family on estate planning and maintaining stock value, balancing personal financial obligations with market stability. Investors will closely monitor the execution of the sale, given the company’s high-profile client agreements and strong share performance.

Overall, the transaction highlights the intersection of family ownership, market sentiment, and strategic corporate planning, as Samsung Electronics continues to expand its position in global semiconductor and tech markets while managing internal financial commitments.