November 26, 2024

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A Samsung flag flies outside its office building in southern Seoul. (Bloomberg)

South Korea's largest conglomerate, Samsung Group, on Wednesday marked the 85th anniversary of its founding in a low-key manner. It is the first year that the big day has been celebrated following de facto leader Lee Jae-yong’s promotion to executive chairman of Samsung Electronics.

Industry sources and Samsung officials said the group commemorated this year’s anniversary without organizing any official events as in other years. There was no special message delivered to employees either, they said.

The top conglomerate has marked the momentous day with a toned-down event following the dissolution of the Future Strategy Office, the group’s control tower office, in 2017. Aside from the group’s meaningful day, its flagship electronics unit celebrates the annual event at the headquarters in Suwon, Gyeonggi Province on Nov. 1, though it was skipped last year during the national period of mourning for the Itaewon tragedy.

“(Since disbanding the control tower office,) Samsung has lost its group identity. Since then, it has been the latest trend to not hold any special events. Even in Samsung Electronics, the last message that Chairman Lee Jae-yong sent (to employees) was in 2019,” a Samsung official told The Korea Herald.

In 2018, the group did not organize any other official events to celebrate its 80th anniversary, except to release a special documentary that can be viewed by employees about the conglomerate’s history. Asked about the video clip, the official said, “It was made on the special occasion to mark the 80th anniversary day celebration.”

Samsung was established in March 1938 by Lee Byung-chull in the southeastern city of Daegu. It started as a small trading firm and entered manufacturing, initially producing sugar and textiles, which aided the country, as it relied on such necessities.

The anniversary of the founding of Samsung, originally March 1, was changed to the 22nd after the late founder's third son, the late Lee Kun-hee, declared the second founding of the conglomerate in 1987.

For the past several decades, Samsung gradually expanded its business sphere to cover the financial sector in the 1960s, industrial chemicals in the 1970s and electronics in the 1980s. The late Lee Kun-hee turned Samsung into a global technology powerhouse and laid the foundation for the country’s rapid economic development. As a result, Samsung has 60 affiliates under its wing, including Samsung Electronics, Samsung Life Insurance, Samsung Display and Samsung C&T.

Backed by current de facto leader Lee Jae-yong’s various aggressive moves on behalf of the group, the accumulated sales of Samsung key affiliates last year surpassed the 400 trillion won ($306 billion) mark for the first time, according to a report from market tracker Korea CXO Institute on Wednesday.

Of the 60 subsidiaries, 20 firms’ audit reports and business reports were released in their regulatory filings to DART, the Financial Supervisory Service’s electronic disclosure board, as of Monday. Based on those companies’ separate financial statements for the last year, the total revenue logged was about 402 trillion won.

It took a decade for Samsung to add 100 trillion won to its accumulated sales to cross the 400 trillion won threshold. The group saw its key affiliates’ sales reaching 312.7 trillion won in 2012, the report showed. The research institute predicted that when combining the 40 subsidiaries, whose business reports have not yet been disclosed, sales revenue will likely reach between 415 trillion won and 420 trillion won.

For the full year, Samsung Electronics alone reported 302.2 trillion won in annual revenue in 2022, surpassing the 300 trillion won mark for the first time. Seven affiliates, including Samsung Securities, Samsung Life Insurance, Samsung Display, Samsung C&T and Samsung SDI, newly joined what has been called the "10 trillion won club" in the same year.

By Jie Ye-eun (yeeun@heraldcorp.com)