Samsung Group faced new regulatory pressure as South Korea's antitrust chief called the company's ownership structure unsustainable, Reuters reported.
Kim Sang-jo, the Korea Fair Trade Commission chair known for criticizing family-controlled conglomerates in the country, took aim at the circular shareholdings between Samsung Electronics Co. Ltd., Samsung C&T Corp. and Samsung Life Insurance Co. Ltd.
Kim urged Samsung Group heir Jay Y. Lee to make a decision regarding the ownership structure, which critics believe has allowed his family to keep control of the businesses with little investment.
The antitrust chief said he was told by Samsung Electronics Vice Chairman Yoon Boo-keun that his comments will be considered, according to the report.
"The clear fact is, the current ownership and control structure of Samsung Group, which goes from Vice Chairman Jay Y. Lee to Samsung C&T to Samsung Life Insurance to Samsung Electronics, is not sustainable," Reuters quoted Kim as saying.
To resolve the complex ownership structure, Kim proposed in 2016 — before he became chairman of the commission — that Samsung Group first create a financial holding company centered on the insurance subsidiary, then form another one later for Samsung Electronics.
Kim's remarks followed those of Financial Services Commission chair Choi Jong-ku, who said Samsung Life Insurance should look for ways to lessen the risks associated with concentrated assets, such as selling the company's stake in Samsung Electronics, Reuters reported.
