Hanon Systems said on 23rd that its board of directors met and approved a rights offering worth 900.025 billion won to repay liabilities, streamline business operations, and improve its fundamentals.
The rights offering will be conducted by allocating 347.5 million registered common shares (51.2% of existing issued shares) to shareholders first, followed by a public offering of forfeited shares. Twenty percent of the new shares will be preferentially allocated to the employee stock ownership association, and the remaining shares will be evenly allocated to existing shareholders as of the new share allocation record date of Nov. 14. After that, any forfeited and fractional shares will be offered to the public.
The planned issue price is 2,590 won per share. It was calculated as the lower of the weighted arithmetic average share price over the most recent one month and one week, and the closing price on the base date, based on the business day immediately before the board resolution date. To enhance corporate value and minimize infringement of existing shareholders' rights, a 15% discount to the reference price was applied, and the final issue price will be set on Dec. 16, just before the public offering subscription.
The funds raised through this rights offering will be used first to repay liabilities. They are also slated for operating funds, facility maintenance, and investment in new production equipment.
Vice Chairman and CEO Lee Su-il of Hanon Systems said, "For future growth, stabilizing the financial structure must come first," and added, "We will respond flexibly to market changes through continuous technology development and strengthening of business capabilities, and do our best to enhance corporate value and shareholder value."