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SEOUL - Samsung Electronics Co (F:SAMEq). Ltd. has announced a significant share repurchase program set to commence on Wednesday, February 19, 2025, and conclude by May 16, 2025. The South Korean tech giant plans to buy back 48,149,247 common shares and 6,636,988 preferred shares, which, based on the closing prices before the board's resolution, amounts to approximately 3 trillion Korean won.
The purpose of the repurchase, as stated by the company, is to bolster shareholder value and facilitate employee stock-based compensation. The shares will be acquired through open market transactions with the assistance of five consignment investment brokers, including Samsung Securities (KS:016360) Co., Ltd. and Korea Investment & Securities Co, Ltd.
Samsung (KS:005930)'s board of directors, consisting entirely of independent directors present at the meeting, unanimously approved the repurchase plan on February 18, 2025. The company has set a daily order quantity limit for the repurchase, with a maximum of 5,246,563 common shares and 663,698 preferred shares to be bought on any given day.
The repurchase aligns with Samsung's strategy to enhance employee motivation through a stock-based compensation program, which will constitute over 50% of the 2024 Overall Performance Incentive (OPI). Approximately 500 billion won worth of the repurchased shares will be allocated to this program. Executives participating in the program will face restrictions on selling their shares for one to two years.
Before the repurchase, Samsung's treasury shares included over 50 million common shares and nearly 7 million preferred shares, representing 0.8% of each stock type. The repurchase is within the allowable distribution profit, and the company has confirmed that no shares were repurchased before this decision.
The repurchase plan is subject to the limit of dividendable profit under the Commercial Act as of the end of 2024, which stands at over 225 trillion won after accounting for the amount of shares repurchased since the end of 2024 and any dividends or profit reserves decided upon by the general meeting of shareholders or the board of directors since then.
Details regarding the timing of cancellation and the actual number of shares to be cancelled will be disclosed following future board resolutions. This share repurchase initiative is part of Samsung's ongoing efforts to enhance shareholder value and provide incentives to its executives for business performance.
This article is based on a press release statement from Samsung Electronics Co. Ltd.
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