Invested 100 Million Won and Received 12 Weeks... SK Biopharm Employee Stock Ownership Average Purchase of 11,820 Shares Per Person

by Oh Jooyean

Published 30 Jun.2020 09:58(KST)

Updated 30 Jun.2020 10:32(KST)

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[Asia Economy Reporter Oh Ju-yeon] SK Biopharm employees purchased an average of 11,820 shares through preferential allocation of employee stock ownership.

According to SK Biopharm's securities issuance performance report on the 30th, the volume allocated to employee stock ownership was 2,446,931 shares, worth a total of 119.9 billion KRW. As of the end of April, SK Biopharm had 6 executives and 201 employees. Considering this, the average purchase amount per person is estimated to be 580 million KRW.

By regulation, 20% is preferentially allocated to employee stock ownership. The allocation volume varies by rank; team leaders reportedly received more than 20,000 shares, worth approximately 1.2 billion KRW. Initially, 3,915,662 shares were allocated, but 40% were forfeited as employees could not fully absorb the allocation.

SK Biopharm has attracted strong interest from investors even before its listing. Accordingly, the recent public offering subscription recorded a competition rate of 323 to 1, attracting a total of 31 trillion KRW in funds. This means that even if one invests 100 million KRW, they would only receive 12 shares.

The success of SK Biopharm is supported by abundant liquidity. Due to concerns over economic deterioration caused by the novel coronavirus disease (COVID-19), the Bank of Korea lowered the base interest rate to 0.5%. As demand and time deposits at commercial banks effectively entered zero interest rates and failed to guarantee returns, investment funds flowed into the securities market. The scale of idle funds classified as money market funds (MMF), comprehensive asset management accounts (CMA), and demand savings deposits reached 1,119 trillion KRW as of the end of April.