Fully Committed to Semicon Investment
Samsung Electronics has decided to sell a portion of its shares in the Dutch semiconductor equipment manufacturer Advanced Semiconductor Materials Lithography (ASML) after holding onto them for seven years. This move is interpreted as an effort to secure funds for investment, especially as the company’s operating profit has neared a deficit this year.
According to Samsung Electronics’ semi-annual report on Aug. 15, the company’s ASML shareholding decreased from 6,297,787 shares in the first quarter to 2,750,072 shares in the second quarter, a reduction of 3,547,715 shares. Consequently, Samsung Electronics’ stake in ASML dropped from 1.6% to 0.7%. The book value (market value) of the stake declined from approximately 5.59 trillion won to 2.6 trillion won.
Samsung Electronics liquidated some of its ASML shares in the second quarter. Considering ASML’s recent stock price, it is estimated that Samsung garnered roughly 3 trillion won from this sale.
Furthermore, in the second quarter, Samsung Electronics also divested 2.38 million shares (0.1%) in China’s electric vehicle manufacturer BYD and 1,544,000 shares in South Korea’s integrated equipment company SFA, potentially securing an investment capacity of around 150 billion won.
To foster a strategic collaboration with ASML, the only company in the world that produces Extreme Ultraviolet (EUV) photolithography equipment, Samsung Electronics acquired a 3.0% stake (12,595,575 shares) in 2012 for 363 billion won. By the third quarter of 2016, Samsung Electronics had sold about half of its stake, about 1.4%, fetching 750 billion won.
In terms of return on investments, Samsung Electronics hit the jackpot. The shares sold this time alone have fetched a profit almost ten times the initial investment of 2012.
The share sale is seen as a move to secure funds for semiconductor investments. Despite the global economic slowdown, Samsung Electronics continues to increase its investments to strengthen future competitiveness. This is evidenced by its record-breaking investment of 23.2473 trillion won in the semiconductor business in the first half of the year.