Celltrion to Absorb Celltrion Healthcare After Gainin Approval for the Merger

Celltrion Group revealed that the merger between two of its subsidiaries - Celltrion Inc. and Celltrion Healthcare Co., Ltd. - has been approved during the extraordinary general meeting of shareholders (EGM) that was held at Songdo Convensia and Sheraton Grand Incheon Hotel, respectively, on Monday, Oct. 23.

As per The Korea Economic Daily, under the deal, Celltrion Inc. will take in Celltrion Healthcare which is serving as its global sales and marketing unit. The pharmaceutical company said that the shareholders’ approval rate for the former was 97.04%, while the latter received 95.17%.

Business Plan After Getting the Shareholders’ Consent

With the latest development in the company, its chairman Seo Jung Jin, promised to turn Celltrion into a global brand in the biosimilar sector. The executive made this vow after returning to office following a two-year hiatus.

The approval also places the biosimilar player one step closer to realizing its plan of combining three of its major affiliates with shareholders of Celltrion Inc. and Celltrion Healthcare Co. In any case, the new entity that will be formed by the merger is set to be officially launched on Dec. 28

"The approval of the merger agreement between the two companies couldn’t have come at a better time because it shortly followed Zymfentra's FDA approval,” an official from Celltrion Group said in a press release. “Both news allows us to move one step closer to achieving our vision of achieving KRW 12 trillion in sales by 2030 and making a leap to become a global biopharma."

He added, "The five new biosimilar products, undergoing streamlined development and regulatory approval processes, are also firmly positioned for sequential roll-outs beginning next year. We will make the utmost efforts to focus on what we do well and further accelerate our growth."

The Acquisition and Share Price Details

Meanwhile, the expected acquisition price for the merger is set at Celltrion Inc.’s closing stock price during the day of the board meeting, which is KRW142,200 and Celltrion Healthcare’s KRW63,500. The shareholders of the latter will get a 0.449 new merged company’s stock for every share they own. It should be noted that this may still change depending on future stock price fluctuation.

“The stock purchase rights limit is set at KRW1 trillion but if demand exceeds the limit, we will buy them all,” Chairman Seo said. “We will remove all uncertainty surrounding our merger plan.”

Photo by: Celltrion PR Center