Samsung To Build New Plant After De Facto Leader’s Release From Prison

Samsung Electronics is planning to start the construction of its new semiconductor production plant following the release of its de facto leader Lee Jae-yong from prison. Specific details about the new facility are not yet available, but they will be revealed soon.

Samsung said Wednesday that it is considering commencing the construction of its new chip plant in Pyeongtaek, Gyeonggi Province of South Korea. The Investor learned directly from the tech giant that it is planning to pick up on prolonged investment plans now that Lee is free.

The new facility is expected to cost around 29.6 trillion won or US$27.2 billion because the company also spent a similar amount when it constructed its first Pyeongtaek semiconductor line. To be clear, Samsung plans to build its new chip production line near the first plant, which mainly produces high-end V-NAND and DRAM chips.

Though Samsung has already disclosed its new plan, an official said other details will be revealed at a later date. “The details, including the type of products to be churned out, investment scale, and production schedule, will be finalized soon,” the official said.

In its fourth-quarter earnings call, Samsung predicted that its DRAM and NAND flash chip shipments would increase 20 percent and 40 percent on-year in 2018. And though the company’s capital expenditure is expected to decrease this year, the firm is still willing to spend more on its chip business than the previous year.

The announcement comes two days after Lee was released from the Seoul Detention Center in Uliwang after a South Korean appeals court suspended his sentence over bribery. The Samsung heir was previously found guilty for bribing former South Korea President Park Geun-hye and the latter’s confidante Choi Soon-sil in return for business favors.

In August 2017, Lee was found guilty and was sent to prison for five years. He appealed his sentence and the ruling turned out to be in his favor. His prison sentence was suspended and his term was cut down to two and a half years. Though he won’t be serving the remainder of his sentence in jail, he will be on a four-year probation after being in jail for almost a year.

It isn’t clear yet if Lee will resume his position as vice chairman of Samsung following the controversy. “Again, I feel sorry to everyone for not showing my best side. And it has been a really precious time for a year reflecting on myself,” Lee told reporters as he was leaving the court room on Monday.