Samsung lead CEO to step down amid 'unprecedented crisis'

Kwon Oh-hyun, vice chairman and the most senior of Samsung Electronics' three CEOs who oversaw the firm's chip and display businesses, will step down in March and pass the baton to younger leadership.
Written by Cho Mu-Hyun, Contributing Writer

Samsung Electronics vice chairman and CEO Kwon Oh-hyun will step down next year, the company said, to make room for young leadership.

Kwon, who also holds the title of vice chairman, was one of the electronics' three CEOs and oversaw the firm's component -- mainly chips and displays -- business. The other CEOs are BK Yoon for consumer electronics and JK Shin for mobile.

As a vice chairman and most senior of the three, and a trusted lieutenant of imprisoned vice chairman and heir Lee Jae-yong, Kwon has played a key managerial role throughout last year's bribery scandal and this year's trials.

The announcement is rare as Samsung hardly ever announces resignations of senior executives before its annual reshuffle.

It likely reflects the anxiety within the conglomerate since Lee's imprisonment; there have been wide concerns of delays in projected plans and the need for a shakeup. Samsung Group disbanded its Future Strategy Office, the group's control tower, after the scion's indictment, and each affiliate has been run independently since.

Kwon will also step down as the chairman of the board and his position as an inside director when the terms end in March. He will also step down his position as CEO of Samsung Display, Samsung Electronics' display affiliate.

"Considering the rapidly changing IT industry, it is the right time for succeeding executives to step up and reform management for anew," he said in a statement.

The company was "confronted with unprecedented crisis inside out," he said. Despite its record profits -- the company expects 14.5 trillion won in profits for the third quarter -- these were results of "past decisions and investments" and Samsung was failing to read the future and find new growth engines, he said.

He hoped his planned resignation will become an opportunity for innovation.

Samsung said Kwon will suggest a successor and notify vice chairman Lee and the board of his decision soon.

Kwon joined Samsung in 1985 and was the key contributor to turning its semiconductor business into the cash cow that it is today. He became CEO and vice chairman in 2012.

It is yet unknown whether the firm will retain its three-CEO management structure after this year's reshuffle, though the shake up may very well be its biggest in recent years. The latest managerial change, which was delayed to May due to Lee's trial, was minimal.

Lee's appeal trial is expected to end early next year.

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