Samsung Restructuring Plan Could Include Spinning Off System LSI Foundry Unit

Samsung has some big decisions to make. The company finds itself in the midst of a reorganization effort following its global recall of Galaxy Note 7 handsets, and where it goes from here is very much up in the are. Behind closed doors, the company is said to be considering a split, and now it's being reported that Samsung is likely to spin off its foundry business division.

The news from South Korea, Samsung's home territory, is that it will shake up its System LSI division in order to grow its semiconductor business and become a leaner outfit. If the reports are true, Samsung will separate its design and manufacturing arm into a new business and divide or spin it off to the fabless and foundry divisions.

Samsung Foundry

As it stands right now, Samsung's System LSI division is mostly comprised of four segments. They include a System-on-Chip (SoC) team that builds mobile processors, a development team that designs display driver chips and camera sensors, a foundry business team, and a support team. Part of the restructuring plan is to combine the SoC and development teams and separate them from the foundry business.

This kind of a split would allow Samsung to take a more systematic approach to system semiconductor design and manufacturing.

Samsung has been under pressure from investors to make a major move. Calls for the company to split originated from Elliott Management, a U.S. hedge fund that has a 0.6 percent state in the firm. It proposed in October that Samsung split into a holding firm and an operating company, along with making a 30 trillion won (around $26 billion) payout to shareholders as part of a special dividend.