Samsung Electronics is reportedly preparing a massive shareholder return package worth more than 100 trillion won ($72 billion), which could become the largest payout ever announced by a South Korean company.
According to a MoneyToday report citing industry sources, Samsung is expected to present the plan to its board before the end of August.
Samsung Considers Special Cash Dividends
The proposed shareholder return programme is expected to include special cash dividends, with much of the funding coming from around 50% of Samsung’s free cash flow.
The company is reportedly leaning toward dividends rather than large-scale share buybacks as its primary method of returning capital to investors.
South Korean Chipmakers Increase Shareholder Returns
Samsung’s reported plans come shortly after rival SK Hynix announced a 40 trillion won ($29 billion) share buyback programme.
The two developments highlight how South Korea’s largest semiconductor companies are considering significantly larger returns to shareholders as the chip industry strengthens.
Could Samsung Return Even More?
Some market analysts have suggested Samsung could potentially return as much as 200 trillion won to shareholders.
However, MoneyToday reported that such a large payout is considered unlikely because Samsung still needs substantial capital to fund future investments and expansion.
Dividends May Be Favored Over Share Buybacks
Samsung’s shareholder return package is expected to rely mainly on cash dividends rather than share repurchases.
One reason is that large buybacks could create additional regulatory complications involving Samsung Life Insurance and Samsung Fire & Marine Insurance, which hold stakes in the technology giant.
As a result, special dividends may provide Samsung with a simpler way to distribute excess cash to investors.
Samsung Balances Returns With Future Investment
Samsung said last month that its board was already discussing its shareholder return strategy for this year, including the possibility of special dividends.
At the same time, the company has stressed that it must balance shareholder payouts with the need to continue investing in future growth.
If approved, the proposed $72 billion Samsung shareholder return plan could set a new record in South Korea and become one of the largest capital return programmes announced by a major global technology company.
