Wednesday, November 06, 2013

(BN) Samsung Plans Acquisitions to Keep Lead Over Apple.

Nov. 6 (Bloomberg) -- Samsung Electronics Co., holding $39 billion in net cash, will pursue more deals as Asia's biggest technology company seeks to grow beyond its core consumer electronics amid fears those businesses are nearing saturation.

The maker of Galaxy smartphones will be more aggressive in making deals after spending about $1 billion investing in 14 companies since 2010, Chief Financial Officer Lee Sang Hoon told a briefing in Seoul today. The company also is considering setting its dividend at 1 percent of its average stock price, a move that could double its cash payout to investors.

The biggest maker of smartphones, televisions and memory chips held its first analyst briefing with top management since 2005 amid concern those segments are peaking as low-cost Chinese producers undercut prices. Samsung shares face their first annual decline in five years as the company becomes more dependent on smartphones, where analysts warn of slower growth even as Samsung sells one of every four handsets globally.

"We will expand our mergers-and-acquisitions strategy beyond a few target areas to pursue opportunities across a wide range of fields," Lee said. The company wants to "enhance the competitive edge of our current businesses and capture new chances for future growth," he said.

Prior investments include Sharp Corp., Novaled AG and Medison Co. as the Suwon, South Korea-based company tries to better integrate its hardware and software offerings.


"Samsung has grown into a global technology behemoth and needs to open itself up more to outsiders," said Marcello Ahn, a Seoul-based analyst at Quad Investment Management. "At least it's good to know that Samsung's thinking about shareholder returns."

The company has earmarked a record 24 trillion won in capital expenditure this year and had spent about 63 percent of the total as of Sept. 30. The spending this year is larger than the market value of Sony Corp.

No comments: