Lee Min-hyung joined The Korea Times in 2014 and has worked as a journalist mainly in Korea’s finance, tech and automotive industry. He specializes in content creation, breaking news and in-depth analysis currently on transportation and mobility. You can reach him via mhlee@koreatimes.co.kr.
SillaJen shares soar after trading resumes
SillaJen's office in Busan / Yonhap
By Lee Min-hyung
By Lee Min-hyung
SillaJen's share price soared around 30 percent after its long-suspended stock trading resumed on Thursday.
The Kosdaq-listed biopharmaceutical firm closed at 10,850 won per share, up 29.47 percent, or 2,470 won, on expectations of its business recovery.
This came a day after the Korea Exchange decided Wednesday evening to allow the trading of SillaJen shares to resume. Trading of the shares was suspended in May 2020 amid an embezzlement scandal.
The decision made headlines, as more than 160,000 retail investors of the company were feared to lose their money under the worst-case scenario of a potential delisting from the country's secondary stock market. As of the end of June, SillaJen's minority shareholders owned more than 66 percent of all of the company's outstanding stocks.
The complete reshuffle of the firm's top management was cited as the main reason behind the latest decision by the exchange operator. In February, the company was given a six-month grace period by the exchange's market committee to improve its business practices.
After reviewing the firm's efforts to expand its product pipeline and research staff, the exchange approved the much-awaited resumption of its stock trading.
The company is known to have gone all out to make the resumption possible.
In January, the exchange decided to delist the firm due to the dim outlook for its sustainable growth. But the following month, the market committee of the secondary trading board granted the grace period, urging the company to secure diverse pipelines and set up an internal committee ensuring transparent management.
“We express our sincere gratitude to our shareholders who have supported the company for a long time,” the company said in a statement, Wednesday. “We will be committed to research and development by closely collaborating with relevant organizations and major shareholders who have enough cash flow.”
But it remains to be seen whether the company will be able to continue its robust rally amid an overall stock market slump both here and abroad. SillaJen's share price topped 130,000 won in 2018 to become the second-most-valuable firm by market capitalization on the Kosdaq.
A coalition of SillaJen's minority shareholders decided Thursday to drop a lawsuit against the Korea Exchange in response to the resumption of the firm's trading.
“We will drop the suit against the exchange, and focus more on legal actions targeting the former top management of the company, including ex-CEO Moon Eun-sang,” it said.