“Japan always came first”… Biden, the reason why he chose ‘Train to Korea’ [강경주의 IT카페] By Hankyung


© Reuters. “Japan always came first”… Biden, the reason why he chose ‘Train to Korea’ [강경주의 IT카페]

President Moon Jae-in and Samsung Electronics (KS:) Vice Chairman Lee Jae-yong visit the EUV building construction site after the system semiconductor vision declaration ceremony held at Samsung Electronics DSR in Hwaseong, Gyeonggi-do on April 30, 2019 [사진=연합뉴스]

There is talk in the business world that Samsung Electronics Vice Chairman Lee Jae-yong’s comeback is imminent. Along with the prospect of US President Joe Biden’s visit to Samsung Electronics’ Pyeongtaek campus during his visit to Korea, there are also rumors that the Blue House trend for the amnesty of Vice Chairman Lee has changed from the past. In addition, Samsung Electronics’ recent recruitment of top semiconductor M&A experts in the United States is also interpreted as a sign of Vice Chairman Lee’s departure. According to the report, President Biden is expected to visit Samsung Electronics’ Pyeongtaek campus during his three-day visit to Korea from the 20th of next month. It is reported that the US side’s advance team has already completed the inspection of the movement and security check. The prospect that Vice Chairman Lee will be present on President Biden’s schedule is gaining strength. A Samsung Electronics official said, “Nothing has been shared about Vice Chairman Lee’s schedule.”

However, a number of business officials said, “The Samsung Electronics Pyeongtaek campus will become the world’s largest semiconductor production base with a single factory by 2030, and President Biden will be very curious.” The vice-chairman will not be present, and since it is the schedule of VVIPs, the route will be kept strictly confidential, but I think the three-shot ‘Biden-Yun Seok-Yeol-Lee Jae-Yong’ from the Pyeongtaek campus will be reflected naturally and the picture of the Korea-U.S. economic alliance will be drawn.” U.S. President Joe Biden whether to take out silicon wafers at semiconductor conference [사진=AP 연합뉴스]

President Biden earlier designated semiconductors as a key factor in the global economic hegemony with China. In April of last year, he held a supply chain video conference at the White House by holding wafers in person. In a situation where the importance of semiconductors is growing, it has been interpreted as pointing out that about 70% of the production volume is concentrated in East Asia, and it is interpreted as a show with a will to maintain technological security hegemony as the master country of semiconductors.

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An official of the Presidential Transition Committee said, “The key agenda for President Biden’s visit to Korea is economic security and technological cooperation. Look at the courses that past US presidents have visited. Japan always came first. But this time it’s different. It is recognized as a clear economic alliance of China and can be viewed as the purpose of showing it off to the outside world.”

Earlier, US President Donald Trump, who visited Korea in July 2017, said that he was surprised by the enormous size of the Samsung semiconductor plant while passing over Pyeongtaek in a helicopter. However, he did not visit the factory in person, so if President Biden visits the Pyeongtaek campus, he will become the first US president to visit a Korean semiconductor factory. side is mentioned. It is being said that the current of the Blue House over the amnesty of Vice Chairman Lee has changed from the past. On the 29th, President Moon Jae-in was the last respondent to the Blue House public petition and expressed his opinion on a total of seven petitions. Regarding the petition against amnesty, he said, “There are many people who have the same opinion as the petitioner (opposition to amnesty). On the other hand, there are many opinions in favor of amnesty for national harmony and unity.” I will judge,” he said.

At the same time, President Moon explained that he had to think more about it, saying, “I still have no choice but to answer in principle,” but in that it reminded me that there are ‘a lot of opinions in favor’, this message should be interpreted as actually opening up the possibility of pardoning Vice Chairman Lee and others. Opinions are emerging as to whether or not

On the 25th, 5 economic groups (the Korea Chamber of Commerce and Industry, the Korea International Trade Association, the Korea Federation of Small and Medium Enterprises, the Korea Employers’ Federation, and the Korea Federation of Small and Medium Enterprises) filed a ‘Plaint for a special amnesty and lottery for economic development and national unity’ to the Blue House and the Ministry of Justice. mentioned These groups cited the reason that the global economy is in a turning point due to the spread of COVID-19, the conflict between the United States and China, and the war in Ukraine, and that the Korean economy is in a crisis that makes it difficult to foresee. . President Moon Jae-in returns to his seat after completing his remarks at the ‘K-Semiconductor Strategy Report’ held at the outdoor stage prepared at the construction site of Samsung Electronics’ Pyeongtaek Complex Line 3 in Pyeongtaek City, Gyeonggi Province on the afternoon of May 13 last year. [사진=연합뉴스]

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In order to overcome the crisis and secure future competitiveness, it was necessary to allow entrepreneurs to avoid legal risks and take active external steps. In particular, the business world emphasized that Vice Chairman Lee’s role is very important in the competition with Taiwan in the semiconductor industry.

In fact, Samsung Electronics maintains a super-gap in memory semiconductors, but it is in the position of a chaser in system semiconductors, which has a much greater future market growth potential. Samsung Electronics is trying to expand its market share through large-scale investment with the goal of becoming the world’s No. 1 in foundry (semiconductor consignment production) by 2030, but the gap in market share with TSMC, the market leader, is not narrowing at the 30% level.

While Taiwan’s semiconductor industry has grown thanks to the full support of the government, it is analyzed that Samsung’s investment has shrunk due to restrictions on the employment of Vice Chairman Lee, etc. In order for Samsung to break through the crisis, bold decisions such as large investments and rapid mergers and acquisitions are required, but some say that the pace is slow because Vice Chairman Lee is tied up. Therefore, domestic economic groups are arguing that Vice Chairman Lee should be given an opportunity to repay the national interest by alleviating legal risks and engaging in active management activities. Samsung Electronics recruits top semiconductor M&A expert In preparation for this, M&A experts were recruited to create an environment. On the 27th, Bloomberg News reported that Samsung Electronics had hired Mako Chisari, a semiconductor investment expert from Bank of America (NYSE:) (BOA), in a senior position. Chisari is a top M&A expert in the semiconductor industry who has served as the managing director and global semiconductor investment division head of BOA Merrill Lynch since 2018.

From Merrill Lynch, he has completed several M&A deals, including Infineon’s acquisition of Cypress (US$10 billion), AMS’s acquisition of OSRAM (US$4.6 billion), and Marvell’s acquisition of Aquantia and Avera. Samsung Electronics Vice Chairman Lee Jae-yong inspects the construction site of the 3rd factory in Pyeongtaek, Gyeonggi Province in January last year [사진=삼성전자 제공]

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From 2016 to 2018, just before joining Merrill Lynch, he served as managing director of Credit Suisse in San Francisco, USA, where he was in charge of M&A of technology companies. Analog Devices’ acquisition of Linear Technology (US$14.7 billion), Broadcom’s acquisition of Brocade (US$5.6 billion), and Qualcomm’s attempt to acquire NXP are large-scale transactions in which Chisari participated as an advisor during his time in Credit Suisse. He also worked at JPMorgan Chase, UAE Abu Dhabi sovereign wealth fund Muba Dala, Global Foundry and others. In particular, he worked at GlobalFoundries as the head of mergers and acquisitions.

In the absence of Vice Chairman Lee, Samsung Electronics has not been able to conduct M&A for six years, even after securing 130 trillion won in cash. Beyond memory semiconductors, new growth engines must be found in other areas, such as foundries and robots, but no M&A or additional investment plans have been proposed. Then, with the recent appointment of Chisari to a high-level position, there is an expectation that a large-scale M&A will be carried out, and there is an analysis that the plan with Vice Chairman Lee is operating.

An industry official said, “On the 28th, Vice Chairman Lee, who had refrained from outside activities outside of the trial, visited the National Museum of Korea with his mother, Hong Ra-hee, former director of the Leeum Museum of Art, and his younger brother, Lee Seo-hyun, chairman of the Samsung Welfare Foundation, and was surprised by the late Chairman Lee Kun-hee’s artwork. He said, “I must have thought a lot while looking at my father’s collection.

Reporter Kang Kyung-joo, Hankyung.com qurasoha@hankyung.com

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