November 24, 2024

• 

[THE INVESTOR] Shortly after the arrest of Samsung Group’s de facto leader Lee Jae-yong last week, speculations began to swirl over possible alternatives for his leadership, with some even touting his younger sister Lee Boo-jin, who currently leads the group’s hotel and duty-free business, as a likely candidate.

Local experts on governance, however, played down the market rumors on a possible takeover by Hotel Shilla’s head, nicknamed “little Lee Kun-hee” for her resemblance to the incumbent chairman of the nation’s largest conglomerate, who at 75 years old has been bedridden for nearly three years. 

Park Hae-mook/The Investor

Observers have said the South Korean tech giant has no alternative figure for Lee Jae-yong and that the job has always been meant for him alone -- and it will continue to be, against all odds.

“There is no other family member who could replace him. The ongoing rumors that his sister Lee Boo-jin taking over his position are comedy,” said Chung Sun-sup, head of Chaebul.com, a local corporate tracker that has followed Korean chaebol closely for years. 

“Despite lingering questions as to whether or not he is qualified for the job, Lee spent more than 20 years (working) to inherit Samsung Electronics, a global firm leading the world’s technology. That is far more complicated than the hospitality business.”

The 48-year-old Harvard graduate joined Samsung Electronics in 1991 and became an executive in 1999. Despite constant interest from the market and the public, the heir had long remained in the shadow of his father, until 2014 when the chairman collapsed due to a heart attack. The son soon emerged as Samsung’s new leader and has been pushing his initiatives by leading high-profile investment plans and deals.

What appeared to be smooth sailing for the de facto leader met a major crisis in the form of a political scandal, as he turned from a victimized corporate head forced to donate funds to foundations run by Choi Soon-sil, President Park Geun-hye’s friend, to a suspect under arrest for bribery, embezzlement and perjury charges.

Samsung has been in a state of emergency since Lee was arrested on Feb. 17. 

Analysts say the group will go on under stewardship and will not be led by any other family members.

Choi Jee-sung, head of Samsung Group’s Future Strategy Office control tower, is likely to take responsibility for the group’s external affairs, with Lee In-yong, chief communications officer at Samsung Electronics, overseeing internal affairs, an industry watcher said on condition of anonymity. 

Choi has worked more than 30 years at Samsung and is said to have closely worked on Lee Jae-yong’s succession. Lee In-yong, 60, is a former TV journalist close to the heir. 

The two were the first to visit Lee at the Seoul Detention Center over the weekend, before any family, reflecting how crucial they are to Lee, he said. 

It is also highly unlikely the group will create a top decision-making council consisting of heads of each affiliate, as SK Group did to fill the leadership vacuum when its Chairman Chey Tae-won was incarcerated.

“Given that each affiliate has operated autonomously, there won’t be a big problem in their daily business. Samsung won’t create a top decision-making body like SK’s SUPEX, because they want to leave that position always for Lee Jae-yong,” the industry expert said.

By Cho Chung-un/The Korea Herald (christory@heraldcorp.com)