Samsung Electronics Considering Ways to Boost Shareholder Value

  • Options being mulled include treasury shares, company says
  • Samsung Securities buying back 119 billion won of stock

Samsung Electronics Co. is considering various options to boost shareholder value as the world’s biggest maker of mobile phones seeks to revive a share price battered by slumping earnings.

No decision has been made and the options include treasury shares, the Suwon, South Korea-based company said in a filing Thursday. Samsung declined to comment beyond the statement.

Shares of Samsung are heading toward their third straight annual decline as falling profit and shrinking market share against Apple Inc. and Chinese vendors weigh on investor sentiment. Returning cash, such as through a buyback, may bolster the stock as the company focuses on ending a slide in sales at its mobile unit and boosting the semiconductor division.

Shares of Samsung rose 0.8 percent to 1,280,000 won in Seoul before Thursday’s announcement. The stock has declined 3.5 percent this year, compared with a 5.6 percent rise in the benchmark Kospi index. The company’s market capitalization has declined by $6.1 billion so far this year, even after a 13 percent rally this month.

Samsung Electronics is due to report quarterly earnings Oct. 29. Preliminary results released Oct. 7 showed operating income jumped 80 percent and sales rose 7.5 percent compared with a year earlier, boosted by a weaker Korean currency.

The company made Thursday’s announcement after the Korea Economic Daily reported that the Samsung Group conglomerate, of which Samsung Electronics is the biggest part, plans to announce ways to boost shareholder value across its affiliates. The newspaper cited sources it didn’t identify.

Samsung Securities Co. said it plans to buy back 118.8 billion won ($104 million) of stock. Samsung C&T Corp., a holding company, said it’s not considering canceling treasury stock.

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