Samsung offices raided
SOUTH Korean prosecutors yesterday raided offices of the Samsung Group and the state pension fund as the electronics giant is dragged further into a snowballing influence-peddling scandal engulfing President Park Geun-hye.
The raid comes as Samsung faces allegations it bribed Park’s confidant Choi Soon-sil to win state approval for a controversial merger it sought last year.
Prosecutors visited the group’s Future Strategy Office, which oversees key business decisions, Yonhap news agency reported.
A Samsung spokesman confirmed the visit by prosecutors but declined to elaborate.
The merger of Cheil Industries and Samsung C&T last year was seen as a crucial step to ensure a smooth third-generational power transfer to Lee Jae-yong, scion of Samsung’s founding family.
It was criticised by many who said it wilfully undervalued Samsung C&T’s stocks, but Seoul’s National Pension Service (NPS) – a major Samsung shareholder – voted in favour of the deal, which eventually went through.
US hedge fund Elliott Management, which controls about 0.62 percent of Samsung, rallied opposition to the deal, and although it lost the battle its campaign was seen as a watershed moment for shareholder activism in South Korea.
Prosecutors also raided several NPS offices yesterday, a spokeswoman for the pension fund said. The NPS oversees funds of 543 trillion won ($461 billion), making it the world’s third largest service of its kind.
The fund is overseen by the Welfare ministry and the minister in charge at the time was regarded as very close to Park.
Choi has been formally indicted on charges of abuse of power and coercion.
She is accused of leveraging her personal relationship with Park to coerce donations from big firms like Samsung to two non-profit foundations which was then used for Choi’s personal gain.