A Seoul court on Monday acquitted Samsung Electronics Chairman Lee Jae-yong of charges over a controversial 2015 merger of two Samsung subsidiaries that allegedly helped him take over South Korea’s largest conglomerate.

Lee was acquitted by the Seoul Central District Court for three years and five months after he was accused of complicity in market irregularities in the merger of Cheil Industries Inc. and Samsung C&T Corp. to strengthen his leadership. group at a lower price.

Lee was charged with stock price manipulation, breach of trust and accounting fraud in connection with a controversial 2015 merger in which three Samsung C&T shares were offered for one Cheil share, Yonhap news agency reported.

The merger was seen as crucial for Lee’s offspring to inherit the family-run group, as his father Lee Kun-hee had suffered a heart attack the previous year.

Prosecutors suspected the group manipulated the stock market to drive up Cheil’s prices and drive down Samsung C&T’s through a series of dishonest practices, including spreading false market information, bulk buying shares of subsidiaries and illegally lobbying the National Pension Service, a major Samsung C&T company. shareholder to support the merger.

Prosecutors suspected that such abuses had continued since 2012 in favor of Lee, Cheil’s largest shareholder with a 23.2 percent stake, to help him consolidate his control over Samsung C&T, the de facto holding company of the Samsung group. .

The acquittal court found no illegality in Lee’s inheritance process.

The court concluded that Lee’s transition as chairman of the group or consolidation of his control over the group was not the sole purpose of the 2015 merger, nor was there any evidence that the merger caused financial losses to shareholders.

The court also found Lee not guilty as charged for involvement in alleged accounting fraud at Samsung Biologics, a subsidiary of Cheil Industries.

“None of the criminal charges in this case have been proven,” the court said.

Lee’s side was pleased with the not guilty verdict. A lawyer representing Lee told reporters after the verdict: “I really appreciate the court’s wise decision.”

The prosecutor has a week to appeal the court’s decision.

In the verdict, Choi Gee-sung, the former head of Samsung’s now-defunct air traffic control tower’s Future Strategy Office, two other former office officials and 10 others were also acquitted of the merger charges.

Prosecutors had sought a five-year prison sentence and a 500 million won ($373,550) fine for Lee, establishing him as the ultimate person responsible for the alleged manipulation scheme.

Lee has denied the charges, claiming that his personal interests were not considered during the merger of the affiliates. He has also asked the court to exonerate him so that he can “concentrate all resources on moving the company forward”.

Lee had been sentenced to 2 1/2 years in prison in the bribery case against ousted former President Park Geun-hye, and was released on parole in 2021 while he was in office. The following year, he was granted a special presidential pardon to restore all his rights and lead.

A Seoul court on Monday acquitted Samsung Electronics Chairman Lee Jae-yong of charges over a controversial 2015 merger of two Samsung subsidiaries that allegedly helped him take over South Korea’s largest conglomerate.

Lee was acquitted by the Seoul Central District Court for three years and five months after he was accused of complicity in market irregularities in the merger of Cheil Industries Inc. and Samsung C&T Corp. to strengthen his leadership. group at a lower price.

Lee was charged with stock price manipulation, breach of trust and accounting fraud in connection with a controversial 2015 merger in which three Samsung C&T shares were offered for one Cheil share, Yonhap news agency reported.

The merger was seen as crucial for Lee’s offspring to inherit the family-run group, as his father Lee Kun-hee had suffered a heart attack the previous year.

Prosecutors suspected the group manipulated the stock market to drive up Cheil’s prices and drive down Samsung C&T’s through a series of dishonest practices, including spreading false market information, bulk buying shares of subsidiaries and illegally lobbying the National Pension Service, a major Samsung C&T company. shareholder to support the merger.

Prosecutors suspected that such abuses had continued since 2012 in favor of Lee, Cheil’s largest shareholder with a 23.2 percent stake, to help him consolidate his control over Samsung C&T, the de facto holding company of the Samsung group. .

The acquittal court found no illegality in Lee’s inheritance process.

The court concluded that Lee’s transition as chairman of the group or consolidation of his control over the group was not the sole purpose of the 2015 merger, nor was there any evidence that the merger caused financial losses to shareholders.

The court also found Lee not guilty as charged for involvement in alleged accounting fraud at Samsung Biologics, a subsidiary of Cheil Industries.

“None of the criminal charges in this case have been proven,” the court said.

Lee’s side was pleased with the not guilty verdict. A lawyer representing Lee told reporters after the verdict: “I really appreciate the court’s wise decision.”

The prosecutor has a week to appeal the court’s decision.

In the verdict, Choi Gee-sung, the former head of Samsung’s now-defunct air traffic control tower’s Future Strategy Office, two other former office officials and 10 others were also acquitted of the merger charges.

Prosecutors had sought a five-year prison sentence and a 500 million won ($373,550) fine for Lee, establishing him as the ultimate person responsible for the alleged manipulation scheme.

Lee has denied the charges, claiming that his personal interests were not considered during the merger of the affiliates. He has also asked the court to exonerate him so that he can “concentrate all resources on moving the company forward”.

Lee had been sentenced to 2 1/2 years in prison in the bribery case against ousted former President Park Geun-hye, and was released on parole in 2021 while he was in office. The following year, he was granted a special presidential pardon to restore all his rights and lead.