Samsung Techwin Workers Protest + Stock Plunges

By John Honovich, Published Dec 10, 2014, 12:00am EST (Info+)

The Samsung sell-off is off to a shaky start.

While the US division frantically tries to convince everyone that things are fantastic, worker actions, Hanwha management signals and stock price movements show it is not.

[Update April 2015: more strikes]

Worker ********

********* ***********************, ******* ******* ******* *** ********** the **** *** *********** *** ******* Electronics ** **** **** ****:

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****** ******* **, ****: ************ *** ************ ******* **** *** ****.

*** ******* **** **** *** ******* *** now ****** ** **** * ***** as ****.

*** **************:

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"******* ********'* ********, ** ********* **** . . . *** ********** *** employees **** ****** ***** ****."

***** ******.* ******* ** ******* *******'* *****'* 2,998 ******* ***** ** ******* ** a *** ******,********* ** *** ****** ******.

Hanwha ********** *******

*******, ********* ******* ******* ** ********.

******* ****** ****** **** "****** ***** *** ******* ** ****** for ** ***** *** **** *** of **********", ****** *** ****** ********* who ********* * **** **** ** **********,"***** **** ****** **** ******** ***** be **** ***, ***** ****** ********, but ****** *** ** ********* *****." (******** *****)

Stock *******

***** **** ******,******* *******'* ******** ******* **** **** **%, ********* a **% **** ** **** *** last *** *****, ******* ******* ******** and ******* *** **** *** ****** assigns ** *** *******.

******?

*** ****** *** ******* ******* ** definitely in ********.

** ** ******* *** ** **** as ***** ********* ****** *** ****** it *** ** **. *** **** change ******* ******* ** ** ****, as *** ************ *** ********** *********.

Comments (18)

Do you thonk LG nows will take a good place in the market?, please give me your opinion.

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LG needs to try harder in surveillance, that's been their issue, regardless of what happens with Samsung. I am not sure how much of a priority surveillance is for LG. From their marketing presence and new product releases here it does not seem to be that high.

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So what will happen to the "Samsung" brand name? Will Samsung Techwin still use the band name after the acquisition?

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So the Samsung Techwin people have given two basic answers: "Yes" and "We're still negotiating it but we are sure we're going to get." They also are claiming that they are going to get it for a long time, many years or 20 years or more.

We will have to wait and see to the transaction is finalized and all of those details are settled.

Even if they get the brand, I am curious what they are going to have to pay to use. Does Samsung say 'Sure, we'll just throw it in' or will they demand a king's ransom knowing it's huge value?

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"We will fight until the Samsung Group withdraws its decision," the workers said in a press release. The reports also says the workers are now trying to form a union as well.

"Take us back, or we'll strike!"

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Could there be a method to their madness of unionizing in hopes of somehow remaining in the Samsung Group?

Maybe... not to influence the Samsung Group, who would see a unionized Techwin as even less attractive than when they sold it, but rather to let Hanwha know that the company they are buying has a highly disgruntled workforce, and therefore not what they bargained for, which would possibly cause Hanwha to find a way out.

Kind of like a after-the-fact rank-and-file poison pill.

"Send us back, or we'll strike!"

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I have no idea. Not even going to guess.

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Korean Herald reports that Hanwha is putting together a task force "charged with putting forward measures to smoothen the integration of the Samsung units with the group's subsidiaries." Also, noting that "A Hanwha executive said the group will retain the workforces of the four Samsung affiliates without any change in their pay and working conditions."

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Not sure if you value the information on the securityinfowatch website, but the below story shed some light on the topic above. Let me know your thoughts:

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It sheds more confusion and spin than light.

For example, his key claim here is false: "This is basically an umbrella changing stock transaction." All the reports from Korea have consistently said that Hanwha is now in control of Samsung Techwin, when it comes to how much people make, who is fired, where they direct resources, etc.

Here is a contradiction: "Samsung Techwin will continue to provide product under the Samsung branding. This is a key negation point with Hanwha and Samsung." If it is still being negotiated, it is not certain that they will get to keep it. Also, not certain how long they will get it or how much they will have to pay (which even if they do keep it, could significantly change their pricing).

This is highly misleading: "We’ve always been Samsung Techwin, which is a publicly traded company separate from Samsung Electronics" Samsung Techwin has leveraged itself highly on the Samsung brand name. They have samsung.com email addresses, most of their marketing and sales material does not even include the word 'Techwin' to maximize people thinking they are getting a direct Samsung product.

Listen, it may wind up that Hanwha keeps the Samsung brand for surveillance and that they keep putting money into it, but that is far from a foregone conclusion, no matter what a regional sales person claims.

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Update: Samsung Techwin workers are scheduled to protest this Wednesday and Thursday.

Also, stock price is down another 10% over the past month.

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A new article talking about why some Samsung Techwin workers continue to protest. Money quote:

“Am I a Samsung employee or Hanwha employee? My family just celebrated my new job but the good news just turned bad,” a newly employed worker at Samsung Techwin wrote on Sungkyunkwan University’s student website after the acquisition.

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What a strange article!? Other memorable quotes:

Regardless of the workers’ agony, Samsung and Hanwha’s so-called “mega deal” is regarded as one of the most successful deals in history.

Before the deal has even closed! Now that's success!

“Some people think becoming a ‘Hanwha Man’ from ‘Samsung man’ is just a matter of name change. But trust me, it is more than just that.”

Sounds like he's becoming a Hanwha-wha Man to me.

“One of the reasons why I want to get into Samsung is so that my parents can boast about their daughter becoming part of the No. 1 conglomerate.”

I wish my daughter was motivated by my need to brag! In any event her parents can simply explain to friends the fact that it is merely an umbrella stock transaction, display the logo and insist that it is business as usual, etc..

To be on the safe side though, current employees might wanted to slowly and imperceptibly transition to being 'Techwin' men and women.

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The acquisition is proceeding, not yet on the Techwin side but other parts are going through:

"Hanwha has finished the job of acquiring a 57.6 percent stake in Samsung General Chemical and a 50 percent stake in Samsung Total. The two companies are now called Hanwha General Chemical and Hanwha Total, the company said in a statement."

One downside - the chemical companies lost the Samsung name.

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"Meanwhile, four other Samsung affiliates including Samsung Electronics posted quarterly earnings higher than market expectations; Samsung Electronics (9.89%), Samsung Techwin (513.15%), Samsung Electro-Mechanics (12.47%), and Cheil Worldwide (2.35%)."

http://www.whowired.com/news/articleView.html?idxno=407116

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C, thanks for sharing.

One thing to emphasize, those are earnings, not revenue. Earnings can fluctuate a lot. For example, if a company had $1 billion in revenue but $1 million in earnings one quarter and then had $5 million in earning next quarter, that would be an increase of 500% in earnings.

Specifically, Samsung Techwin's earnings have historically been quite low (and negative in 2014) - see Samsung Techwin financial summary.

Equally importantly, Techwin has a lot of different businesses so the surveillance one could be doing great and other lines could be terrible (or vice versa) but the overall numbers mask that.

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...those are earnings

Not even earnings really, more like percent change in earnings vs. 'expected earnings', where neither base number is given.

So maybe they were expected to make $1, and they made $513.15 instead. Or maybe they made $51,301,500 when they were expected to make $100,000.

I tried to find the actual earnings for Q1 Techwin, but can't. Maybe someone with better Google-fu can...

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