Samsung Biologics, which is pursuing a spin-off, has cleared the Financial Supervisory Service review. The spin-off timeline was once pushed back as the Korea Exchange review was somewhat delayed, but it appears the company will be able to proceed with the spin-off without further delays in the schedule as it passed the FSS review faster than feared.
According to the FSS electronic disclosure system on the 23rd, the securities registration statement that Samsung Biologics corrected on the 11th took effect. After first submitting the securities registration statement on the 22nd of last month and making two corrections, the financial authorities completed their review, putting the remaining schedule on track.
Samsung Biologics passed the preliminary review for relisting submitted to the Korea Exchange in May in Aug., about three months later, and with the FSS review also completed, only the shareholders' meeting remains before the spin-off. The Samsung Biologics shareholders' meeting to handle the spin-off agenda will be held on the 17th of next month.
Samsung Biologics went through two correction filings after the initial submission of the securities registration statement, but the statement took effect without additional corrections. In the first correction filing, it revised content focused on the necessity and purpose of the spin-off and the business outlook after the split, while in the second correction filing, it provided assurances addressing market suspicions related to governance restructuring.
The FSS had previously said it would scrutinize Samsung Biologics' spin-off under a "focused review," given strong market interest. It is known to have carefully checked matters related to governance restructuring. Some raised suspicions that Samsung C&T, the major shareholder of Samsung Biologics, is seeking to secure large-scale funds through this spin-off to prepare for the possible enforcement of the "Samsung Life Insurance law."
In this regard, Samsung Biologics dismissed the idea, saying there is no purpose of governance restructuring that runs counter to the intent of the spin-off. Through the securities registration statement corrected on the 11th, Samsung Biologics said, "To protect shareholder value of the newly established company, we have pledged not to pursue the listing of Samsung Bioepis, the main subsidiary of the newly established company, for five years from the date of registration of the newly established company."
On May 22, Samsung Biologics said it would separate its subsidiary Samsung Bioepis through a spin-off and establish a new holding company, Samsung Bioepis Holdings (tentative name). The company said the structure in which Samsung Biologics, which operates a contract development and manufacturing organization (CDMO) business, has Samsung Bioepis, a new drug development company, as a subsidiary could raise concerns about conflicts of interest among clients, and the move is meant to dispel those concerns.
However, as reviews by relevant agencies such as the Korea Exchange and the FSS dragged on, concerns arose about schedule delays. In fact, the preliminary review for relisting by the Korea Exchange was extended, causing the schedule to be pushed back once.
When Samsung Biologics first announced its spin-off plan, it postponed the submission of the securities registration statement, initially scheduled for Jul. 29, to Aug. 22 by about a month. Accordingly, the founding of Samsung Bioepis Holdings was changed from Oct. 1 to Nov. 1, and the change of listing and relisting were moved from Oct. 29 to Nov. 24.