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Samsung C&T becomes another Samsung unit to fall under financial probe

2018.05.14 16:04:05 | 2018.05.14 16:06:31
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Samsung C&T became another major Samsung entity to come under financial scrutiny after Samsung BioLogics, which is currently under review for accounting cheat.

The Financial Supervisory Service (FSS) is said to be probing Samsung C&T, the holding arm of the country’s biggest conglomerate, on the possibility of breach in accounting regulations.

The heart of the scrutiny is the separate set of appraisals for assets of Samsung Everland and Cheil Industries before the merger was completed in 2015.

Market observers expect the latest investigation would help the financial regulator’s understanding of its questions in the books of Samsung BioLogics.

Cheil Industries, held a 46.3 percent stake and Samsung C&T 4.9 percent in Samsung BioLogics before Cheil and Samsung C&T became one.

The FSS suspects Samsung BioLogics breached accounting rules in 2015 ahead of its initial public offering in 2016 by inflating the value of its biosimilar unit Samsung Bioepis to post 1.9 trillion won ($1.8 billion) in net profit after making losses in the past years since its foundation in 2011. Samsung C&T maintains as the largest shareholder of Samsung BioLogics with a 43.44 percent stake.

Samsung Group has been under all-around pressure from the new government. After Jay Y. Lee, heir of the group, was released earlier this year when an appeals court acquitted him after a year-long imprisonment implicated with the bribery scandal with impeached President Park Geun-hye, Samsung Life Insurance has been under pressure to dispose of its stake in Samsung Electronics and Samsung Electronics’ after-sales service unit raided for oppressing union activities in addition to the accounting probes.

By Jin Young-tae and Choi Mira

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]

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