Hanwha Solutions postponed its plan for a large paid-in capital increase. It came a day after Vice Gov. Hwang Sun-oh of the Financial Supervisory Service issued public pressure remarks at a media briefing the previous day.
According to the Financial Supervisory Service's electronic disclosure system on the 12th, Hanwha Solutions changed all previously scheduled timelines related to the paid-in capital increase to "to be determined" through a corrected disclosure. As a result, all procedures were halted, including the record date for allotment of new shares set for the 14th and the subscription and payment at the end of June.
The decision came the day after Vice Gov. Hwang Sun-oh of the Financial Supervisory Service (FSS) explained the background of two correction requests to Hanwha Solutions during a briefing on capital market issues the previous day.
Hwang said, "A securities registration statement aims to ensure that information necessary for investors' investment decisions is sufficiently and timely presented," and "When we determine that information necessary for investment decisions is not properly provided, we have no choice but to continue to request corrections."
He added, "In the case of Hanwha Solutions, we wanted investors to be told specifically what the liquidity risks were," and "Whether there really is no way to raise funds other than a paid-in capital increase, and the company predicted that future results would be very strong, but what are the specific grounds? We requested corrections because we thought these parts were lacking."
Previously, on Mar. 26, Hanwha Solutions announced a 2.4 trillion won capital increase plan. But as it said more than 60% of the funds raised, or 1.5 trillion won, would be used to pay off debt, criticism arose that it was "paying off debt with shareholders' money."
After the first correction request from the FSS on Apr. 9, the size of the capital increase was lowered to 1.8 trillion won and the amount for debt repayment was reduced to the 900 billion won range, but a second correction request on Apr. 30 put the brakes on again.
Hanwha Solutions drew a line, saying this is not a withdrawal of the paid-in capital increase. Hanwha Solutions said, "We plan to continue pursuing the paid-in capital increase, but the specific schedule is currently to be determined," adding, "We will disclose as soon as the detailed schedule is finalized."