Lee Kun-hee, Korean icon who transformed Samsung, passes away at 78

News Network
October 25, 2020

samsung.JPG

Lee Kun-hee, who transformed Samsung Electronics Co. from a copycat South Korean appliance maker into the world’s biggest producer of smartphones, televisions and memory chips, has died. He was 78.

Lee passed away on Sunday with his family by his side, the company said in a statement, without mentioning the cause of death. His family will hold a private funeral. He had surgery in 2014 after a heart attack and was treated for lung cancer in the late 1990s.

Lee, who told employees to “change everything except your wife and children” during his drive to foster innovation and challenge rivals such as Sony Corp., was South Korea’s richest person. He had an estimated net worth of $20.7 billion, according to the Bloomberg Billionaires Index. Samsung, the biggest of South Korea’s family-run industrial groups, known as chaebol, has been led by his only son since the heart attack.

“Chairman Lee was a true visionary who transformed Samsung into the world-leading innovator and industrial powerhouse from a local business,” the company said. “His legacy will be everlasting.”

The reins are now set to pass to his only son Jay Y. Lee, who’s been the conglomerate’s de facto leader since his father’s hospitalization in 2014. Lee is expected to eventually inherit a $300 billion company that’s riding a Covid-era boom in online activity. Samsung, the maker of the Galaxy line of smartphones, also supplies semiconductors for Google’s data centers and Apple Inc.’s iPhone. It’s the world’s most advanced maker of displays for TVs, computers and mobile devices.

The younger Lee is currently grappling with two simultaneous legal disputes with South Korean prosecutors over allegations of bribery and corruption, which he’s repeatedly denied.

Lee Kun-hee’s heirs now face an estate tax of roughly $10 billion, and paying it may complicate the family’s control of the Samsung conglomerate -- his beneficiaries would likely have to sell some assets to cover the tax — diluting their stake in Samsung. South Korea’s levy of 50% on estates of more than 3 billion won ($2.6 million) is the second-highest among countries in the Organization for Economic Cooperation and Development, after Japan.

The Samsung empire includes 62 companies. Although the late Lee owned large chunks of some of the businesses — including 4.2% of Samsung Electronics — they’re not big enough to afford control of the conglomerate. The family depends on informal ties to executives who run related companies, and a lot of that soft power may dissipate with Lee’s death.

Global Powerhouse

It was Lee Kun-Hee who built the company into the electronics powerhouse of today, becoming synonymous with the rise of South Korea on a global economic stage.

Named one of the world’s 100 most influential people by Time magazine in 2005, Lee began overhauling Samsung Electronics after he saw the company’s products gathering dust in a Los Angeles electronics store, according to “The Lee Kun Hee Story,” a 2010 biography by Lee Kyung-sik. The Suwon, South Korea-based company had become known for cheap, low-quality electronics gear and was in the “second phase of cancer,” sending out 6,000 people to fix products made by 30,000 employees, Lee said in 1993, according to the biography.

Why Samsung’s Billionaire Scion Faces Two More Trials: QuickTake

The company’s makeover started in 1993 when Lee gathered top executives in Germany and laid out a plan, known as the Frankfurt Declaration, to transform Samsung from a second-tier television maker into an industry leader. The company’s new mission: create high-quality products, even if it meant lower sales.

Samsung Electronics became the world’s top maker of computer memory chips in 1992, the same year it became the first to develop 64-megabyte DRAM chips, according to the company.

Samsung’s Origins

Lee was born on Jan. 9, 1942, in Daegu about 240 kilometers (150 miles) south of Seoul, and was raised in the nearby rural district of Uiryeong, according to the company.

In 1938, his father Lee Byung-chull opened a four-story grocery store in Daegu that would later become Samsung Group.

As a teenager, Lee Kun-Hee liked movies and cars and kept to himself. He took up wrestling and played rugby in high school to fight loneliness. He graduated with a degree in economics from Waseda University in Tokyo and also studied business administration in the U.S. at George Washington University in Washington.

In 1971, Lee Byung-chull chose his youngest son to be his successor, and in 1974, the company moved into semiconductors when it acquired a 50% stake in unprofitable Hankook Semiconductor. The business turned profitable in 1988, helped by dynamic random-access memory chips it produced.

After the Frankfurt Declaration, Lee required employees to arrive at work at 7 a.m. instead of their usual 8:30 a.m. start, so they could “soak up reform in their slumber,” according to the biography.

In 1995, he assembled 2,000 workers to watch him make a bonfire out of 150,000 mobile phones, fax machines and other company products that didn’t meet his quality standards.

Lee’s cultural change eventually produced results. Samsung Electronics surpassed Tokyo-based Sony to become the top seller of flat-screen TVs in 2006, the same year its market value exceeded $100 billion.

In 2010, Samsung introduced the Galaxy-branded smartphone running Alphabet Inc.’s Android software, which helped it pass Apple as the world’s biggest smartphone maker in 2011 in terms of units sold. By introducing the Galaxy Note in 2011, Samsung created a new product niche known as the phablet, a smartphone-tablet hybrid.

Political Controversy

Samsung became the biggest seller of all mobile phones in 2012, unseating Nokia Oyj, which had been the industry leader for more than a decade. Its success in smartphones then boosted profits at its component businesses, including memory chips, display and processors.

Lee’s career was also notable for its setbacks and controversies. An expansion into the car business was unsuccessful. Samsung Motor Inc. rolled out its first automobiles in 1998 and failed to attract buyers. The unit was placed into receivership and Renault SA purchased a majority stake in 2000.

Lee was mired in political scandals in the late 1990s after being convicted of paying bribes to former president Roh Tae-woo in 1996. He was pardoned by President Kim Young-sam a year later.

In 2009, Lee was found guilty of tax evasion and breach of duty for causing losses at Samsung SDS Co., an information technology services provider, because he knew the company illegally sold bonds with warrants to his son at artificially low prices. He was fined 110 billion won and received a suspended three-year jail sentence.

Presidential Pardon

Four months after the 2009 ruling, South Korea’s then-President Lee Myung-bak pardoned Lee, a member of the International Olympic Committee, so he could help the country’s successful bid to host the 2018 Winter Olympics in Pyeongchang.

Lee, who resigned from the board of Samsung Electronics in 2008 amid the controversies, returned as chairman in March 2010, telling employees the business was “facing a real crisis.”

“In 10 years, the majority of products that represent Samsung may no longer exist,” he said in a statement announcing his return. “We must have a new start. There is no time to hesitate.”

Two months later, Samsung Group said it would invest 23 trillion won to expand in areas such as health care and solar batteries by 2020.

Lee’s son, Jay Y. Lee, became vice chairman of Samsung Electronics in December 2012 and his daughter, Lee Boo-jin, is president of Hotel Shilla Co., a Samsung affiliate, raising concerns that the founding family would maintain its grip on the conglomerate at the expense of minority shareholders. That issue lies at the heart of the two legal disputes the younger Lee is now embroiled in.

In August 2019, the Supreme Court ordered the retrial of Jay Y. Lee over bribery charges that voided an earlier decision to suspend Lee’s 2.5-year prison sentence. A special prosecutor had indicted the Samsung heir on charges of bribing a friend of former President Park Geun-hye in return for government backing for a merger that helped cement his control over Samsung while his father was hospitalized.

In 1967, Lee Kun-hee married Hong Ra-hee. In addition to children Jay Y. and Boo-jin, he had a daughter, Lee Seo-hyun. Another daughter, Lee Yoon-hyung, died in 2005 at age 26.

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
March 16,2024

AIE.jpg

Budget carrier Air India Express has launched a new fare family, offering travelers the option to save on flight tickets by traveling light, with an increased baggage allowance of up to 40kg or no check-in luggage at all.

The new fare categories, applicable to flights to and from the UAE and other international destinations, are:

•    Xpress Lite
•    Xpress Value
•    Xpress Flex
•    Xpress Biz

Xpress Lite offers cabin baggage-only fares, making it the most economical option for passengers traveling with the airline.

Xpress Value fare includes 15 kg check-in bag fares, while Xpress Flex offers unlimited changes with no change fees. Xpress Biz features business class seats, complimentary meals, and priority services.

A subsidiary of Air India and a part of Tata Group, the airline introduced Xpress Lite on February 20 for UAE passengers who prefer traveling without check-in baggage.

Xpress Biz fares are accessible on all the new Air India Express Boeing 737-8 aircraft. Travelers can benefit from increased baggage allowances of 25kg for domestic flights and 40kg for international flights when booking Xpress Biz fares. This fare offers priority check-in, baggage, and boarding services.

Air India Express is already operating aircraft with Biz seats across 70-plus routes in India.

In a previous interview with a news channel Aloke Singh, managing director of Air India Express, stated that the carrier was looking to increase capacity to the Gulf region, including the UAE, as well as to provide better connectivity to Gulf travelers.
 

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
March 14,2024

bengaluru.jpg

The UN agency for Palestinian refugees (UNRWA) says at least five people, including a staff member, were killed and 22 others wounded after Israeli forces targeted a food distribution centre in Rafah in the southern Gaza Strip.

UNRWA Commissioner General Philippe Lazzarini in a statement on Wednesday said that the strike hit one of the very few remaining UNRWA distribution centers in the eastern part of Rafah.

“Today’s attack on one of the very few remaining UNRWA distribution centers in the Gaza Strip comes as food supplies are running out, hunger is widespread and, in some areas, turning into famine,” Lazzarini said.

“Every day, we share the coordinates of all our facilities across the Gaza Strip with parties to the conflict," he continued.

He said the attack was carried out even though "the Israeli Army received the coordinates including of this facility yesterday."

Lazzarini further urged the protection of the UN, its staff, and its premises and called for an independent investigation.

Israel acknowledged an airstrike on a food aid distribution center in southern Gaza, which it claimed targeted and killed a high-ranking member of Hamas. 

Meanwhile, the statement by the UNRWA head added that since October 7, at least 165 team members have been killed while in the line of duty and more than 400 people sheltering in UN buildings also lost their lives due to Israel's attacks.

More than 150 of the agency’s facilities, including schools and shelters, have been hit in the war, with some destroyed, and UNRWA staff have reportedly been mistreated and humiliated while in Israeli detention centers, according to the UNRWA.

Six aid seekers killed in Israeli attack

Separately, the health ministry in the Gaza Strip said six people were killed in the latest attack on Palestinians waiting for humanitarian aid at the Kuwait Roundabout in Gaza City.

The Wafa news agency said some 83 people who were wounded in the attack have been transferred to the al-Shifa Medical Complex in the city.

Over the past weeks, Israeli forces have increased their offensives on the Kuwait Roundabout, an area where large groups gather to wait for aid deliveries.

Israeli forces killed 11 people waiting for food aid at the roundabout on Monday night.

The Israeli military has restricted the delivery of humanitarian supplies to northern Gaza for weeks, and thousands of children are going without sufficient food and medication.

The prevention of aid convoys comes as humanitarian officials have already issued a dire warning, stating that unless a ceasefire is implemented and aid is significantly increased, the toll of malnutrition and disease is expected to rise, leading to an alarming loss of lives.

So far, the Tel Aviv regime has killed at least 31,272 Palestinians, mostly women and children, and injured 73,024 others.

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
March 28,2024

fire.jpg

Mangaluru, Mar 28: A fish meal factory in the Baikampady Industrial area in Mangaluru was gutted in a fire incident on Thursday, officials said.

The factory is owned by the company 'Shihar Enterprises', they said.

According to the locals, the fire was first noticed at 4.45 am today, which was immediately reported to the fire department.

The fire engines reached the spot and tried to douse the fire, but it had already spread to other parts of the factory. After almost four hours of fire-fighting operation, the blaze was completely doused, officials.

The reason for the blaze is still being probed, the fire department officials said, adding that they suspect an electric short circuit could have triggered it.

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.