Timing Mixup
Samsung C&T and Samsung SDI jointly announced on April 1 that they will sell their Samsung General Chemicals shares to Hanwha Chemical on April 3. Samsung C&T owns 12.75 million or so of them, and Samsung SDI currently owns 5,752,281 shares. After the announcement, it was said that the Hanwha Group would acquire the Samsung Group’s chemical subsidiaries first, which employees are relatively less opposed to the M&A between the groups, before completing the M&A deal covering defense companies such as Samsung Techwin by June.
However, Hanwha Chemical is showing a different stance. According to its public announcement regarding the acquisition of shares, the date of the acquisition is June 30 as previously scheduled.
The confusion between the two parties is due to their different interests. The Samsung Group has no reason to keep the shares because it already decided to sell the subsidiaries. However, the Hanwha Group is in no position to take control until it completes the negotiations surrounding compensation of the employees.
Samsung General Chemicals and Samsung Total have to terminate their transactions by paying the price for sale or make a decision in compliance with it if they are to change their names and appoint directors from Hanwha by holding a shareholders’ meeting. However, the party negotiating with the employees changes from Samsung to Hanwha once Hanwha takes control, with the negotiations for the compensation between Samsung and the employees showing little progress.
The labor union’s opposition is likely to be intensified if Hanwha is given management rights in the current situation, which means the purchase of the shares on April 3 is practically impossible. The employers do not have any pretext to object to the union, either.