Celltrion Healthcare Holdings locations … Comprehensive merger of 3 Celltrion brothers next year



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Project for the merger plan of Celltrion, Celltrion Healthcare and Celltrion Pharmaceuticals
Promote the merger of Celltrion Holdings and Celltrion Healthcare Holdings

On the 25th, Celltrion Group presented a plan for the merger of the so-called ‘3 Celltrion Brothers’ such as Celltrion, Celltrion Healthcare and Celltrion Pharmaceutical.

This is a method of establishing a holding company system by creating a Celltrion Healthcare holding company and merging with Celltrion Holdings, a Celltrion holding company.

The two holding companies will merge to solidify the holding company system, and the three Celltrion companies will merge to allow one company to take over the entire R&D, production and sales process.

Celltrion predicts that the three companies will merge next year.

◇ Establishment of Celltrion Healthcare Holdings, ‘Celltrion Healthcare Holdings’
Celltrion Group established Celltrion Healthcare Holdings (hereinafter Healthcare Holdings) in preparation for the merger of the three companies.

It is a holding company of Celltrion Healthcare.

Healthcare Holdings was created by investing in Celltrion Healthcare shares in kind held by Celltrion Group Chairman Seo Jeong-jin, the largest shareholder in Celltrion Healthcare.

As a result, Celltrion Healthcare’s largest shareholder changed from Seo chairman to Healthcare Holdings.

Chairman Seo’s stake in Celltrion Healthcare changed from 35.54% to 11.21%, and the stake in Healthcare Holdings, which became a new shareholder due to in-kind investment, is 24.33%.

Celltrion Healthcare Holdings establishments ... Merged with '3 Celltrion Brothers' next year (total)

Celltrion Group explained that the establishment of Healthcare Holdings aims to separate ownership and management, and to strengthen governance.

Immediately after the merger requirements are met, it plans to promote the merger between Celltrion Holdings and Healthcare Holdings to establish a holding company system for Celltrion Group by the end of 2021.

When the requirements for restricting the actions of portfolio companies are met in the ‘Fair Trade and Monopoly Regulation Act’, the merger of the three companies Celltrion, Celltrion Healthcare and Celltrion Pharmaceutical will also be rapidly promoted.

A Celltrion Group official said: “In order to merge the two holding companies, the merger of Celltrion Holdings and Healthcare Holdings will be promoted from September next year, as (the corporation) must survive for at least one year.” “If all the procedures are carried out quickly, it will be possible next year.”

Celltrion Healthcare Holdings Establishments ... Next Year's '3 Celltrion Brothers' Merged (Total)

◇ The merger plan materializes before the end-of-year retirement of Chairman Seo … Corporate governance reorganization
Celltrion Group hopes that through the establishment of Healthcare Holdings, it will be able to establish a separate holding, ownership and management system, as well as further strengthen the professional management system.

Previously, Chairman Seo was not only the largest shareholder in Celltrion Healthcare, but also the largest shareholder in Celltrion Holdings.

According to the Celltrion Holdings audit report published in March this year, Chairman Seo’s ownership is 95.51%.

Celltrion Holdings owns a 20.03% interest in Celltrion and Celltrion owns a 54.97% interest in Celltrion Pharmaceutical.

Celltrion Holdings, which is the majority owner of Chairman Suh, has Celltrion and Celltrion Pharmaceutical as subsidiaries and subsidiaries.

If Healthcare Holdings is established as planned on the day and the merger between Healthcare Holdings and Celltrion Holdings, the governance structure will be simplified and the dominance of the president will be further strengthened.

The largest shareholder in Celltrion and Celltrion Healthcare is the same as Holdings (Celltrion Holdings and Celltrion Healthcare Holdings) after the merger, which simplifies shareholder formation.

The controversy over the ‘handling work’ that followed the Celltrion Group is also expected to be resolved.

Celltrion is in charge of biopharmaceutical research and development (R&D) and production, and Celltrion Healthcare is in charge of overseas distribution.

It is a business structure in which Celltrion Healthcare buys and sells biopharmaceutical products developed by Celltrion.

For this reason, suspicions have also been raised of driving away false work and sales.

Some have interpreted that Seo, who is about to retire later this year, is trying to shake off this controversy.

Celltrion Healthcare Holdings establishments ... Merged with '3 Celltrion Brothers' next year (total)

◇ Celltrion Group’s goal to become a ‘general biotech company’
Celltrion Group plans to solidify the portfolio company system and establish a commercial company that combines the three companies to literally become a “general biotechnology company”.

This is because Celltrion in charge of biopharmaceutical development and production, Celltrion Healthcare in charge of sales, and Celltrion Pharmaceuticals in the synthetic drugs (chemical drugs) business are expected to create synergies when one becomes one.

Since the development, production, distribution and sale of biopharmaceuticals and synthetic drugs are carried out by a single company, it is possible to improve the transaction structure, reduce costs and improve business transparency.

At the same time, it is expected to greatly increase its efficiency by building a competitive portfolio encompassing biopharmaceuticals and synthetic drugs, while unifying sales channels.

Through this, competitiveness is expected to increase to respond to multinational pharmaceutical companies with capital and scale.

The company’s judgment is that to compete with multinational pharmaceutical companies in foreign markets, it must first expand.

A Celltrion Group official said: “I believe that this merger plan is a way to increase business competitiveness and transparency in the operation. As the merger process is approved by shareholders at the general meeting of shareholders, the details they will be decided in agreement with the shareholders meeting.

The official added: “Through this governance reorganization, we will become a comprehensive biotechnology company that leads the global pharmaceutical and biological market.”

/ yunhap news

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