Republic of Korea: Samsung Electronics andThomson-CSF Form Joint Defense Electronics Company
Consolidating a number of partnerships set up for specific programs such as K-SAM (Korean Surface-to-Air Missile) over the last ten years or more, Korea's Samsung Electronics company and Thomson-CSF have signed an agreement towards the establishment of a joint company.
The operation will involve the acquisition by Thomson-CSF of 50% of the defense business of Samsung Electronics, the leading Korean defense contractor. This joint-venture company will be the first of its kind in Asia.
This new Korean-registered company will provide a full range of systems and equipment in the fields of optronics, military communications, naval combat systems and air defense systems. These activities are complementary to Thomson-CSF's and are part of the Group's core businesses. There are significant opportunities for synergies.
The defense business of Samsung Electronics, headquartered in Seoul, is expected to generate revenues of approximately 170 billion won (EUR 130 million) in 1999 and some 200 billion won (over EUR 150 million) in 2000. It employs approximately 600 people, including a significant number of engineers in research and development, at two main facilities.
The chief executive of the new company will be appointed by Samsung Electronics. Thomson-CSF is to name his deputy as well as the chief financial officer.
The Republic of Korea offers strong long-term growth prospects in Thomson-CSF's markets, and the Korean government is committed to increasing local content in systems procurement for the country's armed forces.
The Samsung/Thomson-CSF operation will provide Thomson-CSF with a solid base in Asia, significantly improving its commercial posture in all Northeast and Southeast Asian markets.
The establishment of this jointly owned company is fully in line with Thomson-CSF's multi-domestic growth and development strategy, and is a further illustration of how the Group is developing its professional electronics business as a global player as well as a local partner.
By building on this multi-domestic model both in Europe and worldwide, Thomson-CSF is consolidating a global network that is close to its customers as well as achieving geographical diversity in its centers of excellence.
Subject to the approval of the relevant authorities, the new company is expected to be established in January 2000.
Samsung Electronics Co., Ltd., with 1998 sales revenues of US$ 16.6 billion (EUR 18 billion), is a world leader in the electronics industry. The Korea-based firm has operations in 46 countries. The company consists of three main business divisions: Multimedia & Home Appliances, Semiconductors and Information & Communications.
Thomson-CSF is Europe's leader and a global front-runner in professional electronics for civil and military markets. Based in 47 countries, with more than 50,000 employees worldwide, of whom more than 30% are outside France, Thomson-CSF generated revenues of EUR 6.2 billion in 1998, of which 70% outside France
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Republic of Korea: Samsung Electronics andThomson-CSF Form Joint Defense Electronics Company
