[THE INVESTOR] Samsung SDS, the IT solutions unit of Samsung Group, said on May 25 it has decided not to sell its home network systems business, hinting at its failed talks with Ireland's Allegion.
“The company considered the sale of home network systems business, but it has decided to withdraw the plans,” the company said in a disclosure to the local bourse operator Korea Exchange.
According to sources, Samsung SDS has been negotiating with Allegion, the Dublin-based security solution developer, to sell its door lock business since last year. But the talks have reportedly seen little progress.
The home network business makes up less than 2 percent, or 160 billion won (US$143.10 million), of the company’s total revenue at about 8 trillion won. About 100 billion won comes from door lock business.
Allegion has expressed interest in taking advantage of Samsung’s brand name and sales channel in Korea’s soaring home security market. Allegion acquired Milre Systek, the nation’s No. 1 digital door lock maker, in 2015.
Samsung SDS has been seeking to sell off less profitable businesses such as logistics and home security in a way to elevate its corporate value amid the ongoing leadership transfer at Samsung Group, the nation’s largest conglomerate.
Currently, its majority stake is owned by key Samsung companies, including Samsung Electronics (22.58 percent), Samsung C&T (17.08 percent) and Samsung Electronics Vice Chairman Lee Jae-yong (9.20 percent).
The company’s shares tumbled early this month when Samsung Electronics announced it would not set up a holding company for now. Under the holding company scheme, Lee was expected to use his Samsung SDS stake to strengthen his influence across the group, especially the crown jewel Samsung Electronics.
By Lee Ji-yoon (firstname.lastname@example.org)