Will the Samsung Scandal Threaten HP Printer Deal?
This goes all the way to the top
The heir and de facto leader of Samsung, Lee Jae-yong, was arrested on February 17th in connection to the corruption and influence peddling scandal that ultimately removed impeached South Korean President, Park Guen-hye, from power. Lee and four other Samsung executives, according to the Associated Press, “will stand trial in the coming months on bribery, embezzlement and other charges linked to the massive scandal.”
Lee, as reported by The Guardian, is alleged to have paid $36 million in bribes to two foundations operated by presidential crony Choi Soon-sil. “In return, Lee allegedly sought government approval for the controversial $8bn merger of two Samsung affiliates in 2015 – a move that would smooth his path to the top of the entire Samsung group.” In a statement on the 15th, Samsung denied paying bribes or making “improper requests to the president seeking favors.”
Despite these claims of innocence, three of the four Samsung executives charged with bribery and hiding assets overseas have since resigned. Samsung has also pledged to reform some of their more shadowy practices, including disbanding the controversial Corporate Strategy Office. However, as the Associated Press points out, Samsung vowed to disband this office when Lee’s father was indicted for tax evasion and breach of trust in 2008 – that promise was not kept.
Samsung trial gets even more complicated
South Korea’s ‘trial of the century’ opened March 9th with Lee’s firm denial of all charges. The following day, Parliament’s decision to impeach Park was upheld by the Constitutional Court, which means the former president could also be brought up on criminal charges, herself. A week later, the prosecution in Lee’s trial accused presiding Judge, Lee Young-hoon, of having conflicting interests due to her father-in-law’s financial connection to Choi, one of the central figures in the bribery scandal. Within a few days, the case had been reassigned to a different judge.
What does this mean for the Copier Channel?
While the effects of the Samsung scandal are largely felt by the people of South Korea in their current political turmoil – what does this mean for the Copier Channel? A big concern is the sale of the Samsung printer business to HP Inc. While the printer business has been spun off in preparation for the sale, S-Printing Solution is still a Samsung subsidiary. As Bloomberg reports, “any acquisitions, major management shuffles and changes to the corporate structure will probably have to wait until Lee’s legal issues subside.” The $1.05 billion deal with HP was expected to conclude by September of 2017. Will the Samsung scandal threaten the HP printer deal? At this point, only time will tell.