Celltrion founder returns, says three-way merger will come within the year

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Celltrion founder returns, says three-way merger will come within the year

Published: 28 Mar. 2023, 18:49

Celltrion Chairman Seo Jung-jin speaks during a shareholder meeting Tuesday in Incheon. [CELLTRION]

A merger of three listed Celltrion companies will come within the year, according to the company's founder and chairman Seo Jung-jin, who returned to the management Tuesday, two years after walking away.

“Celltrion is consistent with our merger plan,” Seo said after a shareholder meeting Tuesday in Incheon.

“The merger will be realized at the end of the year at the earliest, though we have to see how the financial situation goes.”

Seo was appointed as the chairman of Celltrion Holdings and three listed Celltrion companies — Celltrion, Celltrion Pharm and Celltrion Healthcare — during a shareholder meeting Tuesday. His term will last for two years.

Seo first announced his plans to merge three listed companies in January 2020 but retired in March 2021, 19 years after establishing Celltrion, which is now Korea’s 13th largest company by market cap.

Some shareholders wearing headbands staged a picket protest during the meeting, demanding Celltrion CEO Kee Woo-sung resign to take responsibility for the sharply dropped share prices.

Celltrion shares more than halved from their peak, with shares of Celltrion Pharm and Celltrion Healthcare having plunged by around 70 percent.

A group representing shareholders of Celltrion staged a protest in front of Celltrion’s headquarters in Incheon, urging the company to come up with measures to better represent their interests, on Nov. 29, 2021. [GROUP OF CELLTRION'S MINORITY SHAREHOLDERS]

“No words can justify the situation, I truly understand and apologize to all our shareholders,” Seo said. “I will give it my all and work like a salesperson to help Celltrion make more than 2 trillion won [$1.54 billion] in revenue and recover the share prices.”

A full 67 percent of Celltrion shareholders are retail investors, while 56 percent for Celltrion Healthcare and 46 percent for Celltrion Pharm are retail investors.

Seo also hinted about a big merger and acquisition (M&A) plan within the year.

“I anticipate that there will be a good opportunity, maybe in the second half,” Seo added. “Baxter is one of the potential items, but Celltrion will not participate if the cost is too expensive.”

Celltrion said recently it is considering bidding for Illinois-based Baxter International's biopharma solution business, which could cost up to $4 billion.

Seo owns 97.2 percent of Celltrion Holdings, which owns 23 percent of Celltrion, which again owns 55 percent of Celltrion Pharm. Celltrion Holdings also owns 24.3 percent of Celltrion Healthcare.

Celltrion shares closed down 4.7 percent to 151,200 won Tuesday, while Celltrion Pharm fell 12 percent. Celltrion Healthcare dropped 7.6 percent.

Celltrion Pharm handles the domestic sales of products developed by Celltrion, while Celltrion Healthcare handles overseas sales.

BY SARAH CHEA [chea.sarah@joongang.co.kr]