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Samsung may split the company in Two

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Samsung has started recovering from the disaster of its flagship device Note 7 blast case. This incident has dropped Samsung’s share of smartphone market to the lowest in last two years.

In the process of again moving to the top, Samsung on Tuesday has announced about a  consideration of split in the company in two- One in Holding Company and other into  Operating Company.

Samsung in its official announcement has said that it will invite external advisors to review the corporate structure of the company.

The move came in response to the call for restructuring in the company from its shareholders.

The shareholders says that the structure of the company is too tough to understand. This restructuring may bring in improved investor’s return. Critics argue about the current structure of the company which makes it difficult to value Samsung since it’s assets are divided among several sister companies and affiliates.

The result of establishing a separate holding firm will bring these under one name which in turn will improve transparency. This will also help to value Samsung Electronics business.

The Company also has said that it will increase the shareholders return by one third and accelerate its share buyback program.

While Samsung is asserting to gain its investors confidence. The company has to gain the confidence of users too after the disastrous Note 7 blast incident. Restructuring will definitely help improve the business as Samsung Electronics alone can attract the investors attention with its successful products.

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