Green Cross Sells North American Blood Product Subsidiary to Overseas Company for 552 Billion KRW

Exterior view of Green Cross Chungbuk Ochang Plant.

[Asia Economy Reporter Choi Dae-yeol] Green Cross Holdings (GC) announced on the 20th that it has signed a transfer contract to sell its North American blood product subsidiaries to Spain's Grifols for $460 million (KRW 552 billion).

Grifols is the world's largest blood product company, and this is the first time since Green Cross was established that it has sold multiple overseas subsidiaries as a package. Green Cross Holdings is transferring 100% of the shares of its North American blood product manufacturing company GCBT and the U.S. blood center business unit GCAM to Grifols. The company explained that this is a rare mega transfer contract in the domestic pharmaceutical industry.

Due to changes in business conditions such as difficulties in travel caused by the COVID-19 pandemic, which increased uncertainty, the company is evaluated to have taken proactive measures to strengthen its fundamentals. Although Canada’s GCBT has completed facility investments, it has lacked local bio production process experts and has been receiving personnel and technical support from headquarters since 2018 for commercial operation. The original plan was to make it independent around next year, but the possibility of delay has increased due to the suspension of air routes caused by COVID-19. It is also known that Grifols showed strong willingness to acquire the company.

Through this transaction, the company expects to accelerate business by concentrating the previously dual-structured North American blood product division into GC Green Cross. Separately from the North American assets being sold, the company plans to focus on increasing the operating rate of the Ochang plant, GC Green Cross’s domestic blood product manufacturing facility, which has recently completed about double expansion. The company anticipates applying for U.S. approval of 10% intravenous immunoglobulin (IVIG) as early as the fourth quarter of this year and expects to receive approval by the end of next year.

A company official said, "We considered mid- to long-term strategies and financial perspectives comprehensively," adding, "The deal is expected to be completed within this year after going through all necessary approvals such as corporate merger procedures."

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