Samsung to merge two major units

Samsung Group announced Tuesday the merger of two major affiliates, as the South Korean business giant accelerates restructuring efforts ahead of a generational power transfer within the founding Lee family.

The all stock deal, approved by the boards of both companies, would see Samsung's de facto holding company Cheil Industries -- which has interests from fashion to theme parks -- acquire general trade and construction affiliate Samsung C&T.

The merger, which is expected to be completed by September pending shareholder approval, will see Cheil offer 0.35 new shares for each Samsung C&T share.

The two companies are both listed on the Seoul stock market, with Cheil valued at 22 trillion won (US$2 billion) and Samsung C&T 8.6 trillion won as of Tuesday morning.

The combined company -- which will take the Samsung C&T name -- will target annual sales of about 60 trillion won in 2020, compared with their combined sales of 34 trillion won in 2014, Samsung said in a statement.