[Photo by Namkung Jin-woong = timeid@ajunews.com]
Shares of Samsung Engineering soared by more than 20% on Tuesday on news that the company had won two building contracts from Samsung Electronics Co worth a combined 523,600 million won ($448.4 million ).
The value of contracts represents about six percent of last year’s total revenue reported by Samsung Engineering, the struggling plant engineering unit of the country’s biggest Samsung Group.
Earlier this month, Samsung Group said Jay Y. Lee, son of group patriarch Lee Kun-hee and vice chairman of flagship Samsung Electronics, will buy up to 300 billion won worth of shares to be sold by Samsung Engineering Co should existing shareholders not fully take up the firm's 1.2 trillion won rights issue.
Analysts said the company’s capital increase plan would be successful, helping improve its financial conditions.
Samsung Engineering posted a net loss of more than 1.33 trillion won in the third quarter, its biggest quarterly loss in at least six years.
The company laid off hundreds of workers over the past year and announced the right issue plan in October.
Samsung Engineering intends to sell shares for 1.2 trillion won to existing shareholders, more than double its current market capitalization. The company also plans to sell its headquarters building, which has a value of 350 billion won.
By Alex Lee
reporter
Park Sae-jin
swatchsjp@ajunews.com
