Samsung Electronics Co has named Kwon Oh-hyun, the head of its components business, as its new chief executive, replacing Choi Gee-sung, as well as announcing a new logic chip line.

Samsung Appoints New CEO, O-Hyun Kwon

Reuters is reporting the news with Samsung saying in a statement: "As before, Vice Chairman Kwon will oversee the company's component business, but, as CEO, will also handle corporate-wide affairs."

Choi will retain his seat on Samsung Electronics board and assume the role of the head of Samsung Group Corporate Strategy Office to focus on future growth engines for the entire Samsung group of companies.

Jay Lee, the son of Samsung Electronics chairman Lee Kun-hee, will remain as chief operating officer, Samsung said.

Dr. Kwon first joined Samsung Electronics' Semiconductor Business in 1985, and according to his official profile, "has played a major role in the company's rapid advance in the semiconductor industry ever since."

He led the team responsible for the development of the industry's first 64Mb DRAM in 1992, and was promoted to Vice President of Samsung Electronics' Memory Device Technology unit in 1995.

In 1998, Dr. Kwon was appointed Senior Vice President and head of the company's System LSI Division's ASIC business, and in 2000 became Executive Vice President and head of LSI Technology. In January of 2004, Dr. Kwon was appointed President and General Manager of the System LSI Division.

In May of 2008, Dr. Kwon was appointed President of Samsung Electronics' Semiconductor Business.

$1.9bn Spend on New Logic Chips

Earlier, Samsung Electronics announced it would spend $1.9 billion (£1.22bn) to build a new logic chip line to make processors for mobile devices to meet the growing demand for smartphones and tablets. The line is hoped to be completed by the end of 2013.

Samsung, currently the world's number two chip maker, supplies chips for its own smartphones such as the Galaxy S3 and Galaxy Note, as well as to rivals like Apple.

The new line of chips will be built using 300mm wafers and use a 20 nanometer and 14 nanometer process.

Demand for system chips used in smartphones and tablets is set to more than double to $59 billion in 2016 from $23 billion last year, according to research firm Gartner.

In a statement, Samsung said the new line would help meet growing demand for "smart mobile solutions."

Samsung has recently announced a decision to build its first chip manufacturing plant in China to make NAND type flash memory chips, which could cost over $4bn. Samsung shares rose 5.2 percent ahead of the announcement about the new logic chip line.