This article was published on the ChosunBiz MoneyMove (MM) site at 9:48 a.m. on Mar. 18, 2026.
KOSDAQ-listed Sungwoo Electronics moved to recover its investment in the unlisted company Yuhan Cosmetic one and a half years after investing. Sungwoo Electronics decided to invest during Yuhan Cosmetic's management normalization process after its delisting, citing joint projects and other reasons. The sale is expected to bring changes to the business alliance.
On the 18th, investment banking and capital market sources said Sungwoo Electronics sold 10 billion won worth of Yuhan Cosmetic bonds with warrants (BW) that it held for 15 billion won. With this BW sale, Sungwoo Electronics realized a gain of 5 billion won about one and a half years after the investment.
Sungwoo Electronics first became involved when it invested 10 billion won in Yuhan Cosmetic's (then CosOn) BW in June 2024. That was after Yuhan Cosmetic's delisting was decided due to reasons such as a qualified opinion of 'disclaimer' from auditors. Sungwoo Electronics, which had shown interest in the cosmetics business, joined hands with major shareholder Yuhan to work on management normalization.
The BW acquired by Sungwoo Electronics had both coupon and maturity interest at 0%, so it could not expect interest revenue. Even though it recognized that exercising the warrant would be difficult for an unlisted company, it gave up interest revenue. Industry analysts said the investment was likely driven more by joint business than by investment purposes.
After the BW investment, Sungwoo Electronics signed a memorandum of understanding (MOU) with Yuhan to prepare for entry into the medical and cosmetic device markets. It planned to create synergy by cooperating with Yuhan Cosmetic, which operates contract manufacturing for cosmetics (OEM) and original design manufacturing (ODM). By appointing Jo Il-hyun, Sungwoo Electronics' CEO, as co-CEO of Yuhan Cosmetic, a joint management system was also established.
When Yuhan Cosmetic was delisted, Yuhan, despite being the largest shareholder, did not appear overly attached to the company. When delisting concerns were raised, small shareholders strongly protested that it had not acted in advance. For that reason, some analysts say Sungwoo Electronics may have invested in the BW with an eye toward acquiring Yuhan Cosmetic.
The shares Sungwoo Electronics could have secured through that BW amounted to 9,090,909 shares, representing about a 25.18% stake. If it had exercised the warrants included in the BW, it could have become the second-largest shareholder after Yuhan's 32.48% stake.
Sungwoo Electronics' interest in Yuhan Cosmetic was driven by weakness in its core electronic components business. As the smartphone market contracted, it suffered poor performance, recording losses in 2023–2024. To improve results, it expanded into solar power and bio businesses, and after investing in Yuhan Cosmetic it sought business diversification by acquiring Japanese bio company BNS Medical.
A capital markets industry official said, "Given the BW structure, it likely aimed to normalize and acquire the company through joint management and business rather than being a simple financial investment," adding, "As Sungwoo Electronics invested in the bio business and needed production facilities, it likely approached this initially as a strategic investment."
Both sides have not explained the background of the investment recovery, but the industry expects change to be inevitable. Yuhan, the largest shareholder of Yuhan Cosmetic, said, "Because Sungwoo Electronics' BW sale has not yet resulted in payment, it is difficult to take a special position at this time."