S. Korea Prosecutors Seek 5-Year Jail Term For Samsung Elec Chief

South Korean prosecutors have requested a five-year jail term for Samsung Electronics Chairman Jay Y. Lee over his involvement in a controversial merger of Samsung affiliates, which helped solidify his control.

Prosecutors allege that Lee, who then held a 23.2% stake in Cheil Industries, manipulated the merger ratio to inflate Cheil Industries’ stock price while suppressing Samsung C&T’s stock price. I Photo: Yonhap News Agency

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The case is currently being tried at an appeals court, Jack Kim and Hyunjoo Jin reported for Reuters.

Prosecutors also sought a 500 million won (US$386,581) fine for Lee, who was indicted for unfairly intervening in the merger between Samsung C&T and Cheil Industries to facilitate a succession of managerial power, Jasmine Choi earlier reported for Business Korea.

The merger was conducted under the condition of exchanging one Cheil Industries share for approximately three Samsung C&T shares.

Prosecutors allege that Lee, who then held a 23.2% stake in Cheil Industries, manipulated the merger ratio to inflate Cheil Industries’ stock price while suppressing Samsung C&T’s stock price.

This move reportedly ensured a stable acquisition of shares in Samsung C&T, furthering Lee’s control over the conglomerate.