This article was posted on the ChosunBiz MoneyMove site at 3:40 p.m. on Dec. 17, 2025.
Prestige Biologics, whose stock had been depressed by a large issuance of convertible bonds (CBs), chose to extend the maturity instead of redeeming them, prolonging concerns over an overhang (large potential sell-off).
Prestige Biologics has won a series of large contracts this year, but its stock has been falling day after day. Persistent worries about potential sell-side pressure continued to weigh on the stock. Investors expected Prestige Biologics to somehow redeem the CBs maturing early next year, but the company has postponed the task by one year for now.
According to the investment banking industry on the 17th, Prestige Biologics said in a disclosure on the 16th that it will extend the maturity of the third series CB of 45.5 billion won from March 2026 to March 2027 by one year. The CB was issued in March 2023, and at that time the maturity interest rate was 4.12% per year. With this maturity extension, the maturity interest rate has been raised to 4.83% per year.
Prestige Biologics is a contract development and manufacturing organization (CDMO) for pharmaceuticals and has mainly handled production of its parent company Prestige Biopharma's products. Since 2023, it has built biologics manufacturing facilities and expanded its business. However, commercialization of Prestige Biopharma's biologic 'Tuznew' was delayed, leaving it with no notable orders for two years.
Recently, it has secured a string of large contracts from external clients beyond its parent company, raising expectations for improved performance. Starting with a biopharmaceutical contract manufacturing agreement worth about 3.9 billion won in the first quarter of this year, it closed a deal worth 13.2 billion won in the second quarter. Afterwards, by winning three additional contracts including one worth 14.4 billion won, it achieved its largest-ever contract performance. Total orders won this year amount to 36.7 billion won.
But the stock itself has not been strong. Shares that were in the 7,000-won range at the end of last year are currently stuck in the low 3,000-won range. As the large CB maturity approached, overhang concerns were compounded by uncertainty over funding.
Prestige Biologics has raised external funds repeatedly amid prolonged weak performance. Through two rights offerings in 2022 and 2024, it received capital injections from its parent, and in March 2023 it issued CBs worth 45.5 billion won to Octava Fund Limited in Singapore.
The conversion price for the CB is 3,534 won. Converted into shares, that equals 12,874,929 shares. If all of the CBs are converted, an amount equal to 21.07% of the current issued shares could flood the market at once. The conversion price can be adjusted down to a minimum of 2,747 won. As a result, potential investors in Prestige Biologics have been hesitant to invest.
Investors had hoped for redemption at maturity this time, but from the company's perspective finances are tight. As of the third quarter this year, Prestige Biologics' cash and cash equivalents amount to only 4.7 billion won. With increased contract wins, short-term investment needs such as process development and facility improvements have actually grown.
Prestige Biologics said the CB maturity extension will strengthen the stability of its financial structure. However, since it is unlikely that Prestige Biologics' finances will improve dramatically within a year, concerns over continued overhang and worsening funding conditions are expected to resurface next year as well.
Prestige Biologics said the CB maturity extension was made based on investor confidence in the company's growth potential. A company official said, "Because Octava Fund is one of the parent's long-term partners, we plan to maintain an ongoing relationship," and added, "Although early redemption could have been requested, we expect CDMO business growth as the biosecurity law passes and new orders continue into next year."