February 26, 1996 in Social Responsibility News

SAMSUNG Electronics Makes Major Move into India

.SISO to develop application software for semiconductors, information systems, multimedia products and computers
.At least 20 Indian engineers to be hired by the end of this year
.Center to promote advanced technolgy exchanges between Korea and India.

Samsung electronics Co. (SEC) has set up Samsung India Software Operations (SISO) in Bangalore, India, opening a new chapter in advanced technology exchanges between Korea and India.

SISO is the first R&D center to be established in India by a Korean company. The center will hire local engineers to work on joint developmet projects. The locally-hired technicians will also receive specialized training from SEC and dispatched to work at the Head Office in Korea.

SEC plans call for developing key research centers covering application softwares for four main areas -- semiconductors, information systems, multimedia products and computers. As part of the plan, at least 20 Indian engineers will be hired by the end of this year to work at SISO, while SEC will send at least ten of its Korean researchers to India.

According to Jung-Yeol Kim, head of SISO, "we will invest an additional US$5 million by 1998 and plan to promote joint research projects with advanced local organisations such as the Indian Institute of Science (IISc)
and the Indian Institute of Technology (IIF). Our ultimate goal is to develop low-cost software that is appropriate for local markets.

.Upon Indian government approval, a 100%-owned holding company will be established.
.Total investments of US$ 629.6 million are to make Samsung one of the topthree electronics makers in India by 2005.
.The operations are to cover everything from parts and components to finished products.

(SEOUL) - Samsung Electronics Co. (SEC) has decided to establish a wholly-owned holding company in India that will spearhead a US$ 629.6 million local production and sales operation covering color picture tubes, electric and electronic parts as well as finished consumer electronics products.

On February 26, Samsung Electronics?Chairman Jin-Gu Kang held a press conference (for local and foreign press) in New Delhi to announce SEC? plans to make a major move into India. At the press conference, it was revealed that Samsung had applied for Indian government permission to make a large-scale investment in that country and that SEC? current move comes on the heels of receiving that permission.

Out of the total planned investment of US$ 629.6 million, Samsung will directly put in US$ 200.2 million of its own money. The remaining US$ 429.4 million will be raised among joint venture partners and banks.

The holding company, which will be formally established during 1996, will eventually produce and market color TVs, refrigerators, washing machines, microwave ovens, PABX (private automatic branch exchange), paging systems, TDX (time division exchange), other telecommunications systems, pagers, keyphones, cellular phones, facsimile machines, monitors, personal computers, color picture tubes, tuners and other electronic parts and components.

The Indian electronics market is growing at least 15% annually and is expected to be some US$ 27 billion, the same scale as the current annual Chinese market, by 2005. Samsung Electronics is planning this kind of
large-scale investment in order to be amrong the top three electronics makers in India at that time. The company expects its annual sales to be US$ 700 million in 2000 and to reach US$ 1.5 billion by 2005.

In the first stage (to the end of this year), the holding company and a new software development center will be established and the foundation for expanded investment will be in place. The company will steadily expand into the production of consumer electronics products, information systems hardware and parts throughout the second stage (to 1999), and in the third stage (by 2000), a unified strategic operation will be in place.

Samsung Electronics founded a local sales & production subsidiary in India last year, and that company is now in full operation. Samsung recently set up a software development center and plans to have a color TV plant in operation in the second half of this year.

Samsung Electronics Company Ltd., a US$ 21 billion flagship company of Korean-based Samsung Group, is a world leader in the electronics sector, with operations in more than 60 countries. The company develops, manufactures, and markets audio and video products, household electronics goods, computers & peripheral products, display products, telecommunication & information systems, software tools & semiconductors.The Bangalore area, known as "Asian's Silicon Valley," is a hub for high technology in India. The Indian government has designated the region as a "Software Technology Complex " and is inducing leading overseas companies to set up operations there. Already, such powerhouses as Motorola, HP, Oracle, Siemens, IBM and TI have come to Bangalore. SEC's arrival is expected to bring other Korean enterprises.


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