The future of Samsung leadership continues to evolve as the family of the company’s late chairman Lee Kun-hee faces a massive inheritance tax of $10.8 billion.
The family said Wednesday they will pay the amount for his estate and donate his private art collection, made up of 23,000 pieces to two state-run museums as well as provide billions for South Korea’s healthcare system.
The art collection includes books and art work from Marc Chagall, Pablo Picasso, Paul Gauguin, Claude Monet, Joan Miro and Salvador Dali among others.
Lee, who lifted Samsung to its prominent position as the world’s largest smartphone and memory chip maker, died Oct. 25 with an estate local media estimated at roughly $24 billion.
That kind of bill needs an installment plan – even for the Samsung leaders – and the family said they’d be taking care of it via six installments over five years, beginning this month.
“It is our civic duty and responsibility to pay all taxes,” the family said in a statement released by Samsung.
The installment plan carries an annual interest rate currently set at 1.2%, according to tax officials.
Investors hoping for some clarity on how the shares would be distributed were disappointed in the news, causing Samsung’s stock price to drop more than 5% after the announcement.
“There was general investor disappointment as no details about how the stakes will be divided were revealed,” said analyst Lee Sang-hun at HI Investment & Securities.
Regulatory filings will reveal what changes in shareholding have been made, with the key decisions coming from Lee’s son and Samsung Electronics’ vice chairman Jay Y. Lee or other family members.
According to Reuters, the family is considering using shares in affiliated companies as collateral for personal loans to pay part of the tax bill to avoid selling Samsung holdings.