SEOUL (dpa-AFX) - Shares of Samsung Electronics Co Ltd. (SMSN.L, SSNNF.OB, SSNLF.OB) declined around 2 percent on Friday after the South Korean conglomerate said its CEO and Vice Chairman Kwon Oh-hyun has decided to step down from management. The news came after the company said it expects significantly higher operating profit and sales for its third quarter with strong demand for displays and memory chips.
In a statement, Samsung announced that Kwon plans to resign as the company's head of the Device Solutions Business and will not seek re-election as a member of the Board of Directors and the Chairman of the Board when his term ends in March, 2018. Kwon will also resign as the Chief Executive Officer of Samsung Display.
The resignation news came at a time when Kwon was expected to take a bigger role after the arrest of Samsung Group scion and heir apparent Jay Lee in February on bribery charges. The company has also faced departures of other key executives recently.
Kwon said, 'As we are confronted with unprecedented crisis inside out, I believe that time has now come for the company start anew, with a new spirit and young leadership to better respond to challenges arising from the rapidly changing IT industry.'
He was with the company for the past 32 years. Kwon joined the company in 1985 as a researcher of the company's Semiconductor Research Institute in the United States.
'..now the company needs a new leader more than ever and it is time for me to move to the next chapter of my life,' he added.
In an earlier statement, the technology giant said it expects third-quarter operating profit to rise 179 percent to 14.50 trillion Korean won or $12.8 billion from 5.20 trillion won last year.
The company also estimates third-quarter sales of 62 trillion won, 30 percent higher than 47.82 trillion won last year.
The improved results reflect booming demand for displays and memory chips and soaring memory chip prices.
In South Korea, Samsung shares were trading at 2,700,000 won, down 1.46 percent.
Copyright RTT News/dpa-AFX
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