SEOUL - The tycoon who became South Korea's richest man after transforming Samsung into a global tech titan giant best known for its smartphones, memory chips and LED televisions has died at the age of 78.

Mr Lee Kun-hee, who had been hospitalised since suffering a heart attack in 2014, died with his family alongside, including his only son, company vice chairman Lee Jae-yong, Samsung Electronics announced on Sunday (Oct 25).

Condolences poured in from key politicians, while business leaders attended his wake at Samsung Medical Centre's funeral hall in Gangnam.

South Korean President Moon Jae-in paid tribute to Mr Lee for growing Samsung into a global brand with his "innovative leadership" and making it a key driver of the country's economic growth.

Mr Lee, the third son of Samsung founder Lee Byung-chul, is widely considered one of the most important architects of South Korea's post-war economic boom.

Under his leadership, Samsung grew from a small trading company to become the world's largest manufacturer of smartphones and memory chips.

With dozens of affiliates ranging from construction to insurance, hotel and fashion, the Samsung Group contributes to about 20 per cent of South Korea's annual gross domestic product - the largest share by any chaebol (Korean for family-owned conglomerate).

Mr Lee, in turn, became the country's richest and most powerful businessman with a net worth of US$20 billion, according to Forbes.

Born in eastern city Daegu, Mr Lee joined the family business in 1968 after studying business at Japan's Waseda University and George Washington University in the United States.

He took over the reins at the age of 45 in 1987 after his father died. Samsung described him as a "true visionary" whose trademark "New Management" philosophy announced in 1993 served as the "motivating driver of the company's vision to deliver the best technology to help advance global society".

At a time when Samsung was producing cheap, low-quality products for mass export, he decided it was time to "change everything except your wife and children".

To hit home the message that Samsung would no longer tolerate poor quality, he ordered 150,000 defective phones to be burnt and bulldozed in 1995 in front of around 2,000 weeping employees at a factory.

That paved the way for Samsung's hugely popular Anycall mobile phone model and marked the beginning of its rise to a world-class global company.

That corporate transformation will be remembered as Mr Lee's biggest legacy, noted Professor Chang Sea-jin of National University of Singapore (NUS), who wrote the book Sony vs Samsung: The Inside Story of the Electronics Giants' Battle for Global Supremacy.

"No one could understand Mr Lee Kun-hee back then, when everyone was trying to sell in big volumes to increase revenue," Prof Chang told The Straits Times.

"But he changed the focus from quantity to quality, from poor exports to branded products. He is responsible for the Samsung that it is today."

Though known to be an inspirational leader, Mr Lee was reclusive and rarely gave interviews. But like many chaebol patriarchs, he had his fair share of scandals.

In 1996, he was convicted for bribing former president Roh Tae-woo in return for business favours and in 2008, he was found guilty of embezzlement and tax evasion in a slush fund scandal and forced to step down as chairman.

He received suspended sentences in both cases which meant he never had to serve time in jail, and he was eventually pardoned by sitting presidents.

Mr Lee was reinstated as chairman of Samsung Electronics in 2010 but suffered a heart attack in 2014 that kept him in hospital.

His only son Jae-yong, groomed to take over from him, has been serving as Samsung's de facto leader since.

But experts say the succession may be riddled with challenges as the younger Lee is facing trial for unfair trading, stock manipulation and breach of trust in relation to a 2015 merger of two Samsung affiliates in order to consolidate his control of the business.

He had already been jailed in 2017 due to a corruption case tied to impeached former president Park Geun-hye.

Mr Lee, 51, will also have to decide whether to inherit his father's stock assets worth about 18 trillion won, including a 4.18 per cent stake in Samsung Electronics.

If so, he would have to pay 10 trillion won in inheritance tax, according to industry estimates.

Professor Chang from NUS said the younger Lee lacks his father's presence: "Lee Kun-hee was a very charismatic leader and people followed his orders.

Lee Jae-yong doesn't have that kind of charisma, and the indictment and corruption cases make him look like a very weak leader.

"Samsung is still very much a top-down, bureaucratic company, so whether he can take control of Samsung is a big challenge."

Mr Lee leaves behind a wife and two daughters, who run Samsung's hotel business and welfare foundation.

His funeral will be a private family affair on Wednesday.

Samsung said in a statement that "all of us... will cherish his memory and are grateful for the journey we shared with him.

"His legacy will be everlasting."