Celltrion-Healthcare Merger Passes Final Hurdle... "Jumaecheong Event Limited to 7.9 Billion Won"

"Only 0.19% of Total Opposed Shares... Merger Risk Resolved"
Integrated Corporation Scheduled to Launch at the End of December

Celltrion Group announced on the 14th that the total amount exercised for the stock purchase rights related to the merger of Celltrion and Celltrion Healthcare was approximately 7.9 billion KRW.

Seo Jung-jin, Chairman of Celltrion, is speaking at the Celltrion Group 2023 press conference held on the 25th of last month at Park One Tower in Yeouido-dong, Yeongdeungpo-gu, Seoul. Photo by Kim Hyun-min kimhyun81@

The stocks exercised through the stock purchase rights amounted to 41,972 shares of Celltrion (about 6.3 billion KRW) and 23,786 shares of Celltrion Healthcare (about 1.6 billion KRW), respectively. The exercise ratio of the stock purchase rights was only 0.19% of the total number of shares opposing the merger based on the combined shares of both companies. The exercise price per share for the stock purchase rights was 150,813 KRW for Celltrion and 67,251 KRW for Celltrion Healthcare. The exercise period for the stock purchase rights for both companies was from October 23 to November 13.

Both companies view the lower-than-expected scale of stock purchase rights exercise as a result of recognizing the future value of the integrated Celltrion after the merger. Celltrion Group explained that minimizing the scale of stock purchase rights exercise also helped alleviate market concerns about the merger.

With this, the merged integrated Celltrion is scheduled to launch on the 28th of next month. Once the new shares are listed on January 12 of next year, all procedures for the merger will be completed.

The merger between the two companies will be conducted in the form of Celltrion absorbing Celltrion Healthcare, issuing new shares of Celltrion to the shareholders of Celltrion Healthcare. For each common share of Celltrion Healthcare, 0.4492620 common shares of Celltrion will be allocated. The merger price per share is 148,853 KRW for Celltrion and 66,874 KRW for Celltrion Healthcare.

Earlier, Seo Jung-jin, Chairman of Celltrion Group, expressed his commitment to the merger at a press conference. At the press conference held on October 25 in Yeouido, Yeongdeungpo-gu, Seoul, Chairman Seo stated regarding the exercise of stock purchase rights, "Even if the opposing shareholders exercise all their stock purchase rights, the necessary funds are prepared," showing confidence in the merger.

At the extraordinary general meeting held on October 23 to discuss the merger agenda between the two companies, Chairman Seo also persuaded investors by saying, "Even if the stock purchase rights exceed the limit of 1 trillion KRW, I will push through unconditionally," and "I will invest even if I have to borrow money." The merger agenda of Celltrion and Celltrion Healthcare was smoothly passed at the extraordinary general meeting. Most attending shareholders voted in favor, and major proxy advisory firms also expressed support citing reasons such as governance improvement.

Celltrion Group expects cost competitiveness to be strengthened through the merger. This is because the entire business cycle from development to sales will be unified. Before the merger, Celltrion developed pharmaceuticals, and Celltrion Healthcare handled sales. After the merger, aggressive pricing strategies will be possible, and the sales regions and market share are also expected to expand.

Additionally, with the recent success of 'Jimpentra' (generic name: infliximab) obtaining new drug approval in the United States and the smooth progress of development and approval procedures for five new biosimilar pipelines to be launched by 2025, growth is expected to continue. The two companies recently announced record-breaking quarterly sales in their Q3 performance this year.

A Celltrion official stated, "With the successful conclusion of the stock purchase rights, which was considered the biggest hurdle for the merger success, the merger has effectively entered its final stage," adding, "Another milestone toward the goal of achieving 12 trillion KRW in sales by 2030 has been reached, accelerating growth even further."

The official continued, "As new product launches and pipeline development and approvals are progressing smoothly, the leap toward becoming a global big pharma through a quantum jump will also rapidly become visible."

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