[After CB Issuance] Syswork, Investors Smile as Major Shareholder Changes to 'BBB'

[Asia Economy Reporter Yoo Hyun-seok] Investors in Syswork's convertible bonds (CB) are smiling. The news that the largest shareholder will change to BBB has caused the stock price to surge nearly 300% in a month, enabling them to gain huge profits.

According to the Financial Supervisory Service's electronic disclosure system (DART) on the 31st, Syswork announced the exercise of the first tranche CB conversion rights four times this month. The total convertible shares amount to 3,403,422 shares, with a claimed amount of 9.7 billion KRW. The conversion price is 2,853 KRW.

On May 8 last year, Syswork issued the first tranche CB worth 10 billion KRW. At that time, the conversion price was 3,169 KRW per share, and the conversion claim period was from May 10 last year to April 10, 2022. The issuance targets included private equity funds managed by Rhinos, The Platform, C-Square, and Timefolio. The stock price at that time was 3,030 KRW.

After the CB issuance, Syswork's stock price continuously declined. As a result, the conversion price was adjusted to 2,853 KRW in August last year. There were no further adjustments afterward. However, the stock price dropped to as low as 1,165 KRW during trading in March, and on May 11, the start date for conversion claims (May 10 was the start date but it was a weekend), it was only 2,280 KRW. Notably, at the end of last month, it remained at 2,310 KRW, still below the conversion price.

However, this month, with the announcement that Syswork's largest shareholder would change to BBB, the stock price surged. On the 20th, Syswork disclosed that the largest shareholder would change through the sale of the largest shareholder's shares, a paid-in capital increase, and the issuance of CB and bonds with warrants (BW). They are conducting a paid-in capital increase of 8.3 billion KRW (3.6 million shares), and once the funding is completed, BBB is expected to become the largest shareholder.

BBB is a bio company that gained fame by jointly developing a COVID-19 antigen diagnostic kit with Celltrion. Last month, Celltrion announced that the COVID-19 antigen diagnostic kit developed with BBB received European CE certification, and this month it was launched in the United States. Following this news, the stock prices of companies holding shares in BBB, such as Wooridle Hubrain, also surged in the stock market.

As a result, Syswork's stock price, which was 2,620 KRW on the 18th, hit the daily upper limit for five consecutive days from the 19th to the 25th. Trading was suspended on the 26th due to the rapid rise, but the stock price hit the upper limit again on the 27th. Afterwards, on the 28th, it plunged 28.17%, and on the same day, it fell another 7.29%, closing at 8,390 KRW. However, as of that day, Syswork's stock price increase rate reached 263% compared to the end of last month.

If the total convertible shares of Syswork are converted at the current stock price, it amounts to 28.6 billion KRW. The CB listing dates are the 3rd and 9th of next month. If the current stock price continues until next month, CB investors will gain a profit of 5,537 KRW per share, totaling approximately 18.6 billion KRW.

This content was produced with the assistance of AI translation services.