[Funding] Asendio, Rights Offering... Investment in Director Kwak Kyung-taek's New Film

[Asia Economy Reporter Hyungsoo Park] Ascendio, whose largest shareholder changed to Pacific Industry last March, has initiated fundraising through a rights offering. The raised funds will be used for film and drama production, as well as the establishment of a visual effects (VFX) studio.

According to the Financial Supervisory Service's electronic disclosure system on the 8th, Ascendio will issue 0.27 new shares per existing share to raise 26.2 billion KRW. The planned issue price per new share is 1,540 KRW, and a total of 17 million shares will be issued.

Ascendio is a company that produces films, dramas, and performances. It also operates celebrity management and video solution businesses concurrently. In the first half of this year, it recorded sales of 13.2 billion KRW and an operating loss of 800 million KRW. Sales by business division were 5.3 billion KRW from the film division, 4.4 billion KRW from the drama division, 2.7 billion KRW from the solution division, and 800 million KRW from the management division.

The raised funds will be used to maximize profitability. The company plans to invest in investment associations related to film, drama, and content production. 9 billion KRW will be invested in a film being prepared by director Kwak Kyung-taek. Director Kwak is preparing an SF disaster film and a spy film with total production costs of 20 billion KRW and 25 billion KRW, respectively. Ascendio will participate as a producer in the SF disaster film and invest 5 billion KRW. Filming is expected to start in December this year, with a production period of about six months.

The spy action film is scheduled for release in 2023. Ascendio will invest 4 billion KRW and participate as a distributor. The production is handled by Film295, which produced the film "Dark Figure of Crime." Additional production costs will be raised through film investment associations and related institutions.

Ascendio will invest 4 billion KRW in four dramas scheduled to air in the first half of next year. 1.8 billion KRW will be contributed to cultural industry and film-related funds and investment associations. 10.8 billion KRW will be used for the studio town construction project. Ascendio will establish seven studios of approximately 800 pyeong each, one visual effects (VFX) studio of about 500 pyeong, along with auxiliary facilities and parking lots in Anseong, Gyeonggi Province. Previously, on the 30th of last month, Ascendio signed a memorandum of understanding (MOU) with Dong-Ah Institute of Media and Arts for the construction of a studio complex. It will introduce Korea's first one-stop studio concept, providing production studios, virtual studios, outdoor open studios, as well as accommodation, commercial facilities, and exhibition experience spaces. It will also be utilized as a media experience and tourism product.

Ascendio expects to escape capital erosion upon completion of the rights offering. As of the end of the first half of this year, the capital erosion ratio was 33.46%. Although it was in a state of complete capital erosion at the end of 2019, the capital erosion ratio decreased to the 30% range after conducting a rights offering targeting the largest shareholder, Pacific Industry. Upon completion of the shareholder rights offering, capital erosion can be resolved.

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