Samsung Electronics is preparing a share buyback worth about 90 trillion won, one of the largest repurchase programmes a South Korean company has attempted, the Yonhap News Agency reported on Wednesday, citing unidentified industry sources.
Under a pay deal struck last month, the company agreed to set aside roughly 10.5% of operating profit as a special bonus for staff in its Device Solutions semiconductor division, paid in shares rather than cash.
Samsung will need to buy back the treasury stock to hand out, which is what the 90 trillion won is for.
The arithmetic is steep. Yonhap put the total bonus cost at about 154 trillion won over three years, a sum that includes the roughly 40% withholding tax due on the payouts.
The repurchases would be made in phases over three years, beginning as early as July, subject to a board resolution and other procedures, according to the reporting.
Employees will be able to sell a third of the bonus shares they receive immediately, a second third after a year, and the remainder after a further year, a vesting schedule designed to stagger the supply hitting the market.
The deal it pays for was hard-won. Samsung’s largest union had prepared an 18-day walkout that the country’s prime minister warned could cost $668m a day, before government-mediated talks produced a tentative agreement in May.
Workers had pushed for 15% of operating profit, written into their contracts; Samsung had offered 10%. The 10.5% formula that emerged was, in the end, closer to the company’s number than the union’s, but the principle of profit-linked pay was conceded.
What makes the bonus so large is the same thing that makes the buyback affordable, which is the scale of the profit underneath it.
Samsung’s memory business has been transformed by demand for the high-bandwidth memory that feeds AI accelerators, the segment that has turned Korea’s chipmakers into the heaviest weights on the Kospi.
The boom has also reordered the field. Memory rival SK Hynix overtook Samsung as Korea’s most valuable listed company this year for the first time in more than two decades, on the strength of its lead in HBM.
For Samsung, a buyback of this size carries a second message beyond the wage settlement.
South Korean conglomerates have long faced investor pressure over the so-called Korea discount, the persistent gap between the value of their assets and their share prices, often blamed on weak shareholder returns.
A repurchase of close to 90 trillion won, even one driven by a bonus obligation, doubles as the kind of capital return foreign investors have spent years demanding.
The plan is not yet formally Samsung’s. The company had not confirmed the programme, and Yonhap framed it as a decision expected to be ratified by the board rather than one already taken.
The board resolution, expected as early as next month, is the moment the 90 trillion won figure stops being a report and becomes a commitment.
Until then, the number rests on industry sources, and the precise dollar value rests on wherever the won happens to be trading on the day the cheques are written.
