Samsung denies Sam’s accusations

The management of Thai Samsung Electronics Co., Ltd. (TSE) announced in the press conference today that the company denies all accusations made by SAM Corporation. Mr. Kwang Kee Park, Managing Director of TSE, expressed deep regret for any confusion caused to their partners, customers, and consumers. “On behalf of TSE, I reject the business disputes made by SAM Corporation. Samsung operates according to highest standards of business ethics both in Thailand and around the world. TSE has and will cooperate fully with the authorities to clarify the matter.” According to Mr. Arnut Changtrakul, TSE Deputy Managing Director, “TSE appointed SAM as its distributor in January, 2007. During that time SAM provided us its business plan, which also included sales target, as well as distribution plan”. Mr. Arnut continued that, due to SAM’s limited capability to achieve committed coverage of Thai distribution channels and self-proposed sales and import target, SAM ended up having high inventories. In a two-party meeting at Samsung headquarters in Korea on June 18, 2007, a decision was made to restructure the distribution network in order to expand channel coverage. Under this change, SAM would be responsible for the channels that it excels in, which are retail stores, and modern trade consignment. Meanwhile, TSE will be responsible for chain stores (Organized retailers), operators, and modern trade credit which SAM cannot penetrate efficiently. “At that time, TSE also suggested SAM to avoid taking additional stocks in order to minimize SAM’s current inventories” said Mr. Arnut. On SAM’s accusation of TSE deceiving it to purchase old stocks, Mr. Arnut said that SAM ordered current models from the Headquarters that are newly-produced based on the Purchase Order. SAM also refreshed the model list monthly. Another accusation is that TSE failed to provide $1 million financial support, thus causing Bt.63 million financial damage to SAM, Mr.Arnut said that during the initial stage of the operation, SAM requested support from TSE to purchase some stocks from previous distributors. TSE agreed to extend its support based on real figures, provided that SAM presented sound evidences of loss that incur from its purchase and sales of the stock. However, SAM has not yet provided the requested report or clear evidences; i.e. phone models, volumes, prices, suppliers, invoices or transaction documents. And despite that fact, TSE confirms that the company is ready to cover the compensation if clear evidences are presented. On the accusation on the authority of Mr. Kwang Kee Park, Mr. Arnut confirmed that Mr. Kwang Kee Park is the Managing Director of TSE with full authority in the company’s business operation, including aspects of sales, marketing, and import, as well as appointment and termination of a dealer or distributor of Samsung’s products in Thailand, Myanmar, Laos, and Cambodia. For more information, please contact: Thai Samsung Electronics Co., Ltd. Manatase Annawat Tel. 08-1837-3716Email: [email protected] Prinda Nilthachan Tel. 08-1755-7071 Email: [email protected] JWT Public Relations Saruttaya Mahakayee (Oh) Tel. 0-2204-8224 / 08-9665-6819 Email: [email protected] Wanlapa Sookyai (Paew) Tel. 0-2204-8219 / 08-1427-4827 Email: [email protected]

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