South African Riots affect CE Companies
The social unrest facing South Africa after the detention of the country’s former president, has begun to affect both Samsung Electronics (005930.KS) and LG Electronics (066570.KS) who have both seen substantial damage to facilities in a number of cities. According to local press a Samsung warehouse was broken into and looted on Tuesday and an LG Electronics plant was also looted and burned to the ground. The Samsung plant in Durban, which is close to the Airport which is a secure facility, is still intact but the amount of damage is still unknown, and since it is the only TV assembly plant in the sub-Saharan region, it is a key facility for Samsung. The LG plant is responsible for LCD TV and monitor assembly and generates ~$50m/yr in revenue, so the loss of that plant will also be a significant blow to LGE, and the company has yet to decide whether it relocate, withdraw, or re build the facility, as the unrest continues, with a number of other South Korean businesses in Durban also targeted by looters.
South African looters in LG Plant in Durban - Source: Business Korea
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