In today’s briefing:
- Samsung C&T Shareholder Return: Directly Related to Lee Family’s Inheritax Tax Issue
- A Pair Trade Between Samsung C&T and Samsung Electronics Amid Big Share Cancellation at Samsung C&T
Samsung C&T Shareholder Return: Directly Related to Lee Family’s Inheritax Tax Issue
- The target volume is 24,718,099 ordinary shares (13.2%) and 159,835 preferred shares (9.8%). That is, C&T will cancel all of its treasury shares in the next five years.
- C&T’s decision to cancel treasury shares clearly indicates that the family’s fundraising strategy is focused on stake sales rather than dividend increases.
- The number of shares inherited will be the volume Lee Seo-hyun will sell in the short term as this is within the range that minimizes the tax liability through LIFO.
A Pair Trade Between Samsung C&T and Samsung Electronics Amid Big Share Cancellation at Samsung C&T
- Samsung C&T announced the cancellation of its entire treasury shares over the next five years. It has 24.7 million shares of common shares (accounting for 13.2% of common shares outstanding).
- We like a pair trade between Samsung C&T (go long) and Samsung Electronics (go short). Samsung C&T’s share cancellation is likely to have a positive impact on its shares.
- The recent sell-down of most of its shares in TSMC by Berkshire Hathaway is also likely to be viewed negatively by some investors in Samsung Electronics.
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