The Korea Exchange notified Samsung Biologics, which is pursuing a spin-off, of an extension for preliminary listing review period. Since the spin-off, which distributes shares of the newly established company to existing shareholders, does not significantly harm shareholder value, Samsung Biologics' partitioning plan was expected to progress smoothly. However, with recent amendments to the Commercial Act and growing interest in shareholder rights, the Korea Exchange's review of the re-listing after the spin-off has become more cautious.
The Korea Exchange recently requested Samsung Biologics to postpone the submission of the securities registration statement, stating it would extend the necessary deadline for the preliminary listing review. The preliminary listing review, which is conducted when an already listed company re-lists through a partitioning or merger, must evaluate the appropriateness of the procedure and receive a qualified judgment to re-list.
As a result, the originally scheduled public announcement date for the securities registration statement on the 29th has been postponed. In the case of the preliminary listing review, results must be notified within 45 days of receiving the application, and if additional reviews are required, the Korea Exchange can extend the announcement deadline. Corporations will publish the securities registration statement after passing the preliminary review and undergo further review by the Financial Supervisory Service.
A representative from the Korea Exchange noted, "It is not unusual for the preliminary listing review to be delayed," but added, "The spin-off of Samsung Biologics is a matter of great interest in the market, and the review process was somewhat delayed while scrutinizing the relevant materials carefully."
Samsung Biologics announced on May 22 that it would establish the new company "Samsung Bioepis Holdings (provisional name)" by spin-off its subsidiary Samsung Bioepis. This decision came from concerns that the current structure, where Samsung Bioepis operates under Samsung Biologics, which engages in contract development and manufacturing organization (CDMO) for biopharmaceuticals, could lead to conflicts of interest with clients. By separating the biosimilar business into a distinct entity, it aims to alleviate concerns over potential technology leaks from clients who contract production with Samsung Biologics.
Samsung Biologics has announced a spin-off. In a spin-off, existing listed company shareholders distribute shares of the new company in proportion to their equity. Compared to a physical partitioning, where the existing listed company holds all newly listed shares, there is less concern about harming shareholder value.
Therefore, Samsung Biologics' partitioning plan was expected to proceed smoothly. In announcing the spin-off plan, Samsung Biologics also provided a timeline, including the submission of the securities registration statement on July 29, the shareholders meeting on September 16, the establishment of Samsung Bioepis Holdings on October 1, and the change of listing and re-listing on October 29.
However, as the preliminary review by the Korea Exchange is prolonged, the likelihood of delays in future schedules has increased.
Some analysts suggest that the delay in the preliminary listing review for Samsung Biologics is related to the government's recent policies aimed at enhancing shareholder value. The government has been rigorous in scrutinizing cases where minority shareholders' rights are compromised during the re-listing process after partitioning, exemplified by previous instances where PharmaResearch and HANA Micron canceled spin-off plans due to shareholder pushback.
Since the inauguration of the Lee Jae-myung government, the ruling party has emphasized the protection of minority shareholders' rights through amendments to the Commercial Act. The Korea Exchange also stated it would carefully examine any cases that infringe on existing shareholders' interests during the corporate partitioning and listing process and is preparing criteria related to duplicate listings.
However, experts explain that Samsung Biologics' spin-off is fundamentally different from the cases of PharmaResearch and HANA Micron, as the objectives for business separation and efficiency are clear.
A source from the financial investment industry remarked, "The spin-offs of PharmaResearch and HANA Micron were ultimately aimed at increasing the largest shareholder's equity ratio through the transition to a holding company, which risked infringing on existing shareholders' interests, whereas Samsung Biologics has a lower potential for violating their interests as it separates a distinct business entity."