Samsung heir’s visit rattles shipbuilder

Samsung Electronics vice chairman Lee Jae-yong’s rare visit to a Samsung Heavy Industries shipyard has sparked speculations over the fate of the shipbuilding unit, which has been reeling under severe losses.

Market watchers are continuing their guessing game over the Samsung Group heir apparent’s visit Monday to the shipyard on Geojedo Island, South Gyeongsang Province, the first of its kind in eight years.

Sources said that Lee’s move hints at a possible restructuring or sell-off of the loss-making shipbuilder as one of several deals by parent Samsung Group to simplify its shareholding structure in preparation for a power transfer from its ailing chief Lee Kun-hee to his only son.

The group, however, dismissed the rumors, saying it was an “ordinary site visit.”

“The vice chairman was there to encourage employees, and he has frequently visited the sites of subsidiaries on behalf of his father since his hospitalization,” a Samsung Group official said.

According to the group, SHI president Park Dae-young and other executives reported the current state of the shipbuilding market and its trend to the vice chairman on the day.

In September last year, SHI scrapped a $2.5 billion takeover of Samsung Engineering due to shareholder opposition, a setback for the group’s restructuring plans.

Samsung Heavy, the country’s third-largest shipyard, posted the worst quarterly loss of 1.55 trillion won ($1.34 billion) in the second quarter this year and it revised its third quarter result to 10 billion won loss from the earlier announced operating profit of 84.6 billion won as Pacific Drilling scrapped a drillship order.

By Park Han-na (hnpark@heraldcorp.com)