Singapore-based activist Flashlight Capital Partners has requested the shareholder registers of five Samsung affiliates that together hold a 20.6 percent stake in S-1 Corporation, escalating a campaign to improve returns at the South Korean security firm. Founder Sanghyun Lee previously offered 906.6 billion won ($676 million) to buy the units' combined holdings at a 45.2 percent premium.
Flashlight Capital Partners requested shareholder registers of five Samsung units holding a 20.6 percent stake in S-1 Corp, escalating its campaign to lift returns at the South Korean security firm.
"With access to the shareholder registers, we will be able to communicate directly with the shareholders of these five companies," Sanghyun Lee, founder and chief executive of Singapore-based Flashlight, said. "These shareholders have a direct interest in ensuring that their boards properly evaluate our offer and make the decision that best serves shareholder interests."
The five affiliates — Samsung SDI, Samsung Life Insurance, Samsung Fire & Marine Insurance, Samsung Securities and Samsung Card — collectively own 20.6 percent of S-1's shares, according to shareholder information on its website. Japan's SECOM remains the biggest holder at 25.7 percent, though Samsung Group typically appoints one of its executives as chief executive. S-1 also holds 11 percent of its own stock as treasury shares, a practice critics say lets management fend off hostile takeovers.
Lee, a former Korea head at The Carlyle Group, escalated the campaign in August by offering 116,000 won per share in cash for the five units' combined S-1 holdings, a 906.6 billion won ($676 million) bid that represented a 45.2 percent premium over the 79,900 won closing price a day earlier. He said he has also accumulated small stakes in each of the five Samsung units. "There is no strategic rationale for Samsung's lithium battery and financial-services affiliates to continue holding shares in a security-services company given the absence of meaningful business synergies," Lee added.
The offer follows a June campaign in which Flashlight disclosed a $40 million position, roughly 2 percent of S-1's market capitalization. Samsung Group and its five affiliates did not respond to requests for comment, while S-1 said it has "no position to state." S-1 shares opened 0.4 percent lower at 78,900 won as trading began in Seoul on Sept. 9.
The register request pressures the Samsung units' boards to weigh a sale that would crystallize a premium for their own shareholders, testing whether chaebol affiliates will part with a cross-holding that carries little operational logic. Investors will watch whether the five units respond to Flashlight's outreach or whether the activist turns to formal shareholder proposals at S-1's next annual meeting.
This article is for informational purposes only and does not constitute investment advice.
