Samsung Electronics considers share buyback for stock bonuses, details undecided (updated)

Samsung Electronics Co

Yesterday 03:59

Samsung says no timing or size of buyback finalised yet
Disclosure follows reports of 90 trillion won buyback plan
Recasts with Samsung filing
By Heejin Kim and Hyunjoo Jin
SEOUL, June 24 (Reuters) - Samsung Electronics 005930.KS said on Wednesday it was considering buying back shares to fund stock-based employee compensation tied to its 2026 performance, but that no details including timing or size of the buyback had been decided. 
The clarification came in a regulatory filing after local media reported that Samsung would buy back 90 trillion won ($58.61 billion) worth of shares from next month. 
Samsung's management and union last month reached a pay deal under which Samsung is expected to set aside about 10.5% of its annual operating profit for special bonuses for the chip division in the form of stocks, sparking concerns over inequality at the company. 
Employees at Samsung will be able to immediately sell a third of the treasury shares they receive as bonuses, but they will have to wait a year to sell another third and a further year for the remainder. 
Samsung also may need to repurchase additional stocks to award employees under a separate compensation programme, called the "Performance Stock Unit," which was introduced last October to align employee rewards with long-term stock performance. 
Samsung Electronics and chip rival SK Hynix 000660.KS are expected to post record profits this year and next year, as the AI boom has fueled a shortage of memory chips, driving up prices. 
Samsung shares closed up 9.8%, outperforming SK Hynix's 1% gain and reclaiming the top spot by common-share market capitalisation in South Korea.
     ($1 = 1,535.6000 won)

 (Reporting by Heejin Kim, Hyunjoo Jin and Joyce Lee
Editing by Ed Davies, Elaine Hardcastle)
 ((Heejin.Kim@thomsonreuters.com;))