SEOUL - Samsung Electronics Co. on Tuesday said it was considering splitting the company into two, a move seen as necessary for heir-apparent Lee Jae-Yong to take over the firm from his father.
The South Korean firm is struggling to contain the fallout from a global recall of its Galaxy Note 7 smartphone
Samsung has also come under pressure from foreign investors, including US hedgefund Elliott Management, to improve its corporate governance through the establishment of a holding company and to increase dividends for shareholders.
The move comes as the tech giant struggles to contain the fallout from a global recall of its Galaxy Note 7 smartphone prompted by exploding batteries.
Samsung said in a statement it would consider breaking the company into a holding firm and a producing and operating unit and would take at least six months to study the option.
Analysts said a split would give Samsung Electronics' Vice Chairman Lee Jae-Yong a tighter grip on the company through a holding firm.
Elliott and other investors have urged Samsung to set up a holding company as a way to address its complicated layers of cross shareholdings with sister companies.
They also said the company should increase dividends for shareholders.
Samsung said it would increase per-share dividends by 36 percent this year to 28,500 won.