Celltrion (068270.KS) is pursuing a comprehensive set of market measures, including a bonus share issue, share buybacks, and an increase in its largest shareholder's stake, to enhance shareholder value and trigger a re-rating of its corporate value, as previously announced.
Celltrion said Wednesday that, after reviewing measures to enhance shareholder value in light of recent market environment changes, it has decided to simultaneously carry out a bonus issue, share buyback and cancellation, and stock acquisition by its largest shareholder. The aim is to drive up corporate and shareholder value through coordinated market action by the company and its major shareholder.
Earlier, on the 19th, the company posted a "Letter to Shareholders" on its website, diagnosing that "amid the influence of external factors such as recent geopolitical uncertainty in the Middle East, heightened international oil price volatility, and supply-demand concentration in certain industries, the corporate value of the bio and pharmaceutical sector as a whole has not been adequately recognized," and that "Celltrion remains in a zone of excessive undervaluation."
As part of its shareholder return measures, Celltrion will conduct a bonus share issue this year, following last year's. The issuance size is approximately 10.92 million shares, exceeding last year's roughly 8.49 million shares, with 0.05 new shares allotted per common share. The new shares are scheduled to be listed on June 30.
The company will also carry out an additional share buyback. Celltrion has decided to purchase a total of 100 billion won, or approximately 550,000 treasury shares. The company already completed a record-scale treasury share cancellation of 1.8 trillion won, or about 9.11 million shares, last month, and immediately afterward bought back an additional 100 billion won worth of treasury shares. The treasury shares to be purchased this time will also be cancelled within the year. The strategy is to combine share buybacks and cancellations to respond to short-term market volatility while maintaining a structure that raises the long-term shareholder return ratio.
If the latest buyback is also cancelled within the year, Celltrion's total treasury share cancellation this year is expected to reach approximately 2 trillion won, or about 10 million shares. Celltrion cancelled approximately 3.43 million shares in 2024 and about 4.97 million shares last year. Including the latest measures, cumulative cancellations over three years amount to approximately 18.56 million shares, or 8.4% of total issued shares.
Celltrion Holdings, the largest shareholder, has also decided to acquire 100 billion won worth of shares. The company expects that an increase in the largest shareholder's stake will reinforce responsible management and enhance market confidence. Celltrion's employee stock ownership association also plans to proceed with its 12th employee stock subscription.
"Despite macroeconomic uncertainty, Celltrion expects its second-quarter earnings to continue stable growth based on solid fundamentals," a Celltrion official said. "We will do our utmost to enhance shareholder value by simultaneously pursuing corporate value improvement and bold, continuous shareholder-friendly policies."
