Samsung Windfall Gives Lee’s Widow a $7.4 Billion Fortune
(Bloomberg) - Hong Ra-hee, the wife of late Samsung Group chairman Lee Kun-hee, shot her fortune to more than $ 7 billion after she saw billions of dollars in shares in her husband's long-awaited transfer of assets had received.
The 75-year-old Hong inherited around 83 million shares in Samsung Electronics Co., making it the technology giant's largest single shareholder with a 2.3% stake, according to a report last week. According to the Bloomberg Billionaires Index, Hong is the richest woman in South Korea, with a net worth of $ 7.4 billion at the close of trading on Monday.
This is another consequence of the massive loss of wealth following Lee's death, with his son Jay Y. cementing control of the group after his stakes in key affiliates increased significantly. The late Lee's only son is worth $ 12.6 billion, according to the index, while his sisters Boo-jin and Seo-hyun saw their fortunes grow to $ 5 billion and $ 4.4 billion, respectively.
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"It's a win-win for family members," said Park Ju-gun, head of Seoul-based research firm Leaders Index. "It guaranteed Jay Y. Lee more stable control while other family members got more voice with their increased stakes."
A Samsung Electronics spokeswoman declined to comment on the family's net worth.
According to research by UBS Group AG and PwC, billionaires will send more than $ 2 trillion over the next two decades. Petr Kellner and Heinz Hermann Thiele's families are ready to inherit assets worth more than 30 billion US dollars after the entrepreneurs suddenly died this year at the age of 56 and 79, respectively.
The succession drama at South Korea's largest corporation has shaken the country since the late Lee, the patriarch and longtime head of Samsung Electronics, suffered a heart attack in 2014. Jay Y. Lee has been charged with illegal behavior in two separate trials to ensure control of the conglomerate and is currently serving a prison sentence after being convicted of bribery in the first case.
Hong received most of the late Lee's stake in Samsung Electronics as it was split in a 3: 2: 2: 2 ratio between her and her three children. Hong received approximately 33% of the shares, while her children received approximately 22% each according to the ratio prescribed by law.
The holdings in the conglomerate's other major affiliates, the de facto holding company Samsung C&T Corp. and Samsung SDS Co., were transferred in the same ratio.
But Jay Y. was able to tighten his grip when he received half his father's stake in Samsung Life Insurance Co. and increased his stake from 0.06% to more than 10%. Samsung Life owns 8.5% of Samsung Electronics.
Last week, the family announced their plan to pay one of the largest estate tax bills, worth more than 12 trillion won ($ 10.7 billion), as well as their intention to donate 1 trillion won to medical facilities and about 23,000 works of art, including pieces by Pablo Picasso and Claude Monet.
Hong ran Samsung's Leeum Museum, which exhibits works such as Jean-Michel Basquiat's "Untitled (Black Figure)" and Gerhard Richter's "Two Candles". She resigned as a director in 2017 and has not held any leadership positions at Samsung companies.
"It's an extraordinary concentration of wealth," said Park. "The wealth of this single family creates inequality even among conglomerates."
(Adds other billionaire capital transfers in paragraph six.)
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