The family of late Samsung Electronics chairman Lee Kun-hee said on Wednesday they will pay more than 12 trillion won ($10.8 billion) in inheritance taxes for his estate and donate his vast private art collection to state curators.
Mr Lee, who is credited with transforming Samsung into the world’s largest smartphone and memory chip maker, died on October 25 with an estate valued at around 26tn won.
The Lee family’s handling of the hefty inheritance tax bill – one of the largest-ever globally – has been closely watched as it could have resulted in the dilution of the family’s controlling stake in Samsung.
There was also significant public interest amid calls for Mr Lee’s $1.76bn art collection to stay in South Korea, and reports the family planned to make a large donation to make reparations for Mr Lee’s conviction on tax evasion and embezzlement charges more than a decade ago.
The family said they planned to pay the tax bill over a period of five years in six instalments, starting this month.
“It is our civic duty and responsibility to pay all taxes,” it said in a statement released by Samsung.
Shares in Samsung C&T shares dropped as much as 5.5 per cent, however, as the statement provided no detail on how Mr Lee’s shares would be distributed, if any shares would be sold, nor specifics on how the family planned to fund the payments.
“There was general investor disappointment as no details about how the stakes will be divided were revealed,” said Lee Sang-hun, an analyst at HI Investment & Securities.
Investors will instead need to wait for regulatory filings to discover changes in shareholdings by Mr Lee’s son and Samsung Electronics vice chairman Jay Y. Lee or other family members.
It is our civic duty and responsibility to pay all taxes
The family had been discussing using shares in affiliated companies as collateral for personal loans to pay part of the tax bill to avoid the sale of their Samsung holdings, Reuters reported last week, citing sources.
Analysts have said the family is likely to use loans and dividends from both their own and Mr Lee’s shares to pay the tax.
Mr Lee’s shareholdings included a 4.18 per cent stake in Samsung Electronics, 0.08 per cent of Samsung Electronics preferred shares, 20.76 per cent of Samsung Life Insurance, 2.88 per cent of Samsung C&T, and 0.01 per cent stake in Samsung SDS.
Samsung C&T is the de facto holding company of Samsung conglomerate, of which Mr Jay is the largest shareholder with a 17.33 per cent stake.
The heir is currently halfway through a 30-month jail sentence for bribery and other offences. The presidential Blue House on Tuesday dismissed calls from some business lobby groups to grant him a pardon.
As anticipated, the family announced it will donate 1tn won to improve public healthcare, including 500 billion won to build South Korea’s first specialist hospital for infectious diseases.
Mr Lee’s extensive personal art collection, including masterpieces by Picasso, Monet and Warhol, will be donated to organisations, including the National Museum of Korea and the National Museum of Modern and Contemporary Art.
The family said the philanthropic donations from Mr Lee’s estate would “uphold his legacy and contribute to the creation of a better society”.
Former culture ministers and art groups had earlier called for a new law to allow the family to donate the art in lieu of some of the tax bill.
US Industrial Market figures, Q1 2017
Vacancy Rate 5.4%
Markets With Positive Absorption 85.7 per cent
New Supply 55 million sq ft
New Supply to Inventory 0.4 per cent
Under Construction 198.2 million sq ft
(Source: Colliers)
UAE currency: the story behind the money in your pockets
Mercedes-AMG GT 63 S E Performance: the specs
Engine: 4.0-litre twin-turbo V8 plus rear-mounted electric motor
Power: 843hp at N/A rpm
Torque: 1470Nm N/A rpm
Transmission: 9-speed auto
Fuel consumption: 8.6L/100km
On sale: October to December
Price: From Dh875,000 (estimate)
UAE currency: the story behind the money in your pockets
In the Restaurant: Society in Four Courses
Christoph Ribbat
Translated by Jamie Searle Romanelli
Pushkin Press
Tailors and retailers miss out on back-to-school rush
Tailors and retailers across the city said it was an ominous start to what is usually a busy season for sales.
With many parents opting to continue home learning for their children, the usual rush to buy school uniforms was muted this year.
“So far we have taken about 70 to 80 orders for items like shirts and trousers,” said Vikram Attrai, manager at Stallion Bespoke Tailors in Dubai.
“Last year in the same period we had about 200 orders and lots of demand.
“We custom fit uniform pieces and use materials such as cotton, wool and cashmere.
“Depending on size, a white shirt with logo is priced at about Dh100 to Dh150 and shorts, trousers, skirts and dresses cost between Dh150 to Dh250 a piece.”
A spokesman for Threads, a uniform shop based in Times Square Centre Dubai, said customer footfall had slowed down dramatically over the past few months.
“Now parents have the option to keep children doing online learning they don’t need uniforms so it has quietened down.”
Glossary of a stock market revolution
Reddit
A discussion website
Redditor
The users of Reddit
Robinhood
A smartphone app for buying and selling shares
Short seller
Selling a stock today in the belief its price will fall in the future
Short squeeze
Traders forced to buy a stock they are shorting
Naked short
An illegal practice
UAE currency: the story behind the money in your pockets
'Operation Mincemeat'
Director: John Madden
Cast: Colin Firth, Matthew Macfayden, Kelly Macdonald and Penelope Wilton
Rating: 4/5
More from Neighbourhood Watch:
Company profile
Name: Back to Games and Boardgame Space
Started: Back to Games (2015); Boardgame Space (Mark Azzam became co-founder in 2017)
Founder: Back to Games (Mr Azzam); Boardgame Space (Mr Azzam and Feras Al Bastaki)
Based: Dubai and Abu Dhabi
Industry: Back to Games (retail); Boardgame Space (wholesale and distribution)
Funding: Back to Games: self-funded by Mr Azzam with Dh1.3 million; Mr Azzam invested Dh250,000 in Boardgame Space
Growth: Back to Games: from 300 products in 2015 to 7,000 in 2019; Boardgame Space: from 34 games in 2017 to 3,500 in 2019
Tips for SMEs to cope
- Adapt your business model. Make changes that are future-proof to the new normal
- Make sure you have an online presence
- Open communication with suppliers, especially if they are international. Look for local suppliers to avoid delivery delays
- Open communication with customers to see how they are coping and be flexible about extending terms, etc
Courtesy: Craig Moore, founder and CEO of Beehive, which provides term finance and working capital finance to SMEs. Only SMEs that have been trading for two years are eligible for funding from Beehive.
The rules of the road keeping cyclists safe
Cyclists must wear a helmet, arm and knee pads
Have a white front-light and a back red-light on their bike
They must place a number plate with reflective light to the back of the bike to alert road-users
Avoid carrying weights that could cause the bike to lose balance
They must cycle on designated lanes and areas and ride safe on pavements to avoid bumping into pedestrians
How to help
Donate towards food and a flight by transferring money to this registered charity's account.
Account name: Dar Al Ber Society
Account Number: 11 530 734
IBAN: AE 9805 000 000 000 11 530 734
Bank Name: Abu Dhabi Islamic Bank
To ensure that your contribution reaches these people, please send the copy of deposit/transfer receipt to: juhi.khan@daralber.ae
Profile of Udrive
Date started: March 2016
Founder: Hasib Khan
Based: Dubai
Employees: 40
Amount raised (to date): $3.25m – $750,000 seed funding in 2017 and a Seed round of $2.5m last year. Raised $1.3m from Eureeca investors in January 2021 as part of a Series A round with a $5m target.
MIDWAY
Produced: Lionsgate Films, Shanghai Ryui Entertainment, Street Light Entertainment
Directed: Roland Emmerich
Cast: Ed Skrein, Woody Harrelson, Dennis Quaid, Aaron Eckhart, Luke Evans, Nick Jonas, Mandy Moore, Darren Criss
Rating: 3.5/5 stars
