Samsung El.gdr Regulatory News (SMSN)

LCD Business Spin-Off

On February 20, 2012, the BOD of Samsung Electronics approved the spin-off of the LCD business.

Details

1. Overview

Currently, the display market is undergoing rapid changes with OLED panels expected to

fast replace LCD panels to become the mainstream. Amid this structural change of the

Display industry, adopting measures for change and innovation, including business

restructuring, are essential to improve our competiveness for our Display business.

In this regards, first, the LCD business will be spun off from Samsung Electronics and

become a new corporation (wholly-owned subsidiary of Samsung Electronics). Then,

going forward, the new corporation will consider adopting various restructuring measures

including a merger with Samsung Mobile Display and S-LCD Corporation.

※The new corporation :

- Number of shares to be issued: 150 million shares

- Shareholders' equity: KRW750 billion (par value: KRW5,000)

- Net asset: KRW13.6 trillion

2. Decision making

- Decided by attendance of three Executive Directors and four Independent Directors

3. Expected benefits of the spin-off

Independent operation as a company specializing in display panels going forward, will

enable our LCD business to: 1) achieve continuous growth by strengthening its

competitiveness based on the select and focus strategy and taking an advantageous position

in the future display market ahead of competitors:

2) reinforce its technological competitiveness;

3) enhance speed in investment/strategic decision-making process; and

4) establish autonomous and responsible management.

4. Major upcoming schedules

- General Meeting of Shareholders for approval: March 16, 2012

- Effective Date of the spin-off: April 1, 2012

- The inaugural General Meeting of Shareholders of the new corporation: April 2, 2012

5. Others

- Dissenting shareholders' appraisal right: Not applicable as the spin-off constitutes a

real division as stipulated from Article 530-2 to 530-12 of the Commercial Act.

- Succession of employment contracts and relevant legal relations: In principal, the new

corporation will succeed all employment contracts and relevant legal relations (severance

pay, loans, etc.) pertaining to all the current employees of LCD business.

- Since Samsung Electronics and the new corporation will be jointly held liable for debts

held itself before-the spin-off, there is no separate period set for creditors to submit their

objection to the spin-off.

※This spin-off plan is subject to change in accordance with the results of consultations

 with related agencies, the relevant law and regulations, and the approval process at the

 General Meeting of Shareholders.

※Appendix: Pre/post spin-off financial position

[Appendix ] Pre/Post Spin-Off Financial Position

(September 30, 2011, K-IFRS, parent basis)

Note 1) The above figures can be revised to those as of the spin-off date.

2) The above figures are based on separate financial statements. The domestic law does not

specify which type of financial statements shall be adopted for public disclosure.

Since consolidated financial statements also includes the year's financial positions of other

companies, we thought separate financial statements would be more appropriate in figuring

out actual changes in the substances of the concerned companies' financial position.

3) In general, cash includes not only cash & cash equivalent assets but also short-term

 financial assets and short-term available-for-sale financial assets. The amount of cash

 to be succeeded by the new coporation is about KRW500 billion, which is 3% of the total

 assets to be succeeded by the new entity (approximately KRW17 trillion).

 The proportion is very low considering that the cash-to-total asset proportion is 10%

 for the pre-spin company and the post-spin surviving corporation.