Samsung Biologics rights offering highlights future growth, but stock price drops
Samsung Biologics will issue new shares worth 3 trillion won ($2.17 billion) to finance its planned acquisition of a Swiss-headquartered contract drug manufacturer and the expansion of its manufacturing facilities in Korea. Its shares fell after the announcement on Friday, as the new offering will increase the number of outstanding shares. However, analysts said the capital increase could…
Samsung Biologics plans to raise 3 trillion won ($2.17 billion) through a rights offering to fund its acquisition of a Swiss drug manufacturer and the expansion of its facilities in South Korea. The news led to a drop in Samsung Biologics' share price, as the increased share count would dilute existing shareholders' ownership. However, analysts believe the additional capital could bolster the company's future growth by enabling Samsung Biologics to quickly enter the rapidly expanding market for materials in obesity treatments and increase production capacity ahead of upcoming large-scale orders.
The company intends to issue 2.27 million new shares, making up 4.9 percent of its outstanding shares. Each share will be priced at 1.322 million won, generating the total 3 trillion won needed. Of this funding, 2.7 trillion won will be used to acquire PolyPeptide Group, a global contract development and manufacturing organization, while the remaining 294.8 billion won will be allocated to building Samsung Biologics' sixth plant in Incheon.
Written by urgent.news from The Korea Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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