Fates of SillaJen, Osstem Implant to be determined this week

Shareholders of SillaJen hold a protest in front of the Korea Exchange (KRX) building located on Yeouido, Seoul, on Feb. 8. Newsis

By Anna J. Park

The fates of two scandal-ridden companies are to be decided this week, as the Korea Exchange (KRX) is set to make its decisions on their listing status on Thursday and Friday, respectively.

First to face the KRX's judgment will be Osstem Implant, which was suspended from stock trading at the start of the year due to an employee having embezzled over 221 billion won ($184 million). On that day, the bourse operator will decide whether to forward the case to its corporate evaluation committee for an additional, more thorough assessment of the dental implant materials company's listing. The decision was scheduled to be completed by the end of last month, but it was delayed to this week due to the need for a cautious approach.

If the KRX decides on Thursday that Osstem Implant doesn't need further assessment by the corporate evaluation committee, the trading suspension will be lifted on the company's stocks and trading will resume on Friday. If the KRX decides it needs to go through the corporate evaluation committee inspection, however, the committee will decide whether to delist the company or give it a grace period, giving it a second chance to improve.

On Friday, the KRX's Kosdaq market committee will make a significant decision regarding SillaJen: whether the biopharmaceutical company should be delisted or instead be given a grace period to improve its situation. About a month earlier, the bourse operator's corporate evaluation committee decided to delist the bio tech company, sending a huge blow to its minor shareholders. Following the corporate evaluation committee's delisting decision, the Kosdaq market committee has to reach its own judgment by Friday.

The Kosdaq market committee's decision could result in one of the three outcomes: delisting, maintaining of its listing status or allowance of a grace period. If the market committee once again decides on delisting, another meeting could be held for deliberations.

SillaJen's stocks have been suspended since May 2020, due to allegations of embezzlement and other malpractices by the firm's former and incumbent management.

Facing an uncertain future, the two firms' minor shareholders have been under extreme stress and anxiety. SillaJen had over 174,000 minor shareholders as of the end of 2020, while Osstem Implant had 19,857 as of last September.