Huons Global announced on the 22nd that it acquired 408,757 shares of HuM&C from the 14th to the 16th. This amounts to approximately 396.73 million won.
HuM&C is a specialized subsidiary of Huons Group focused on total healthcare materials. It specializes in the production and supply of cosmetic accessories and medical glass containers.
With this acquisition, Huons Global's equity stake in HuM&C increased from 57.09% to approximately 57.92%.
Huons Global explained, "We purchased shares of our subsidiary HuM&C to increase our equity and enhance shareholder value through stock price stabilization."
Earlier, HuM&C announced a reverse stock split at a ratio of 1 for every 5 shares to improve its financial structure on the 13th. A reverse stock split refers to a situation where shareholders lose shares equal to the split ratio without any compensation when a corporation conducts a capital reduction.
The company noted that it decided on the reverse stock split to cover losses and improve its financial structure. The record date for the split is set for July 28. Upon completion of the reverse stock split, the capital will decrease from approximately 24.5 billion won to 4.9 billion won, and the number of listed shares will drop from about 49.05 million to 9.81 million.
The company also resolved to transfer capital reserves to retained earnings. By reducing capital reserves for dividends, it becomes possible for shareholders to receive tax-exempt dividends on the corresponding amount. The company believes it may also enable value enhancement through share buybacks in the future.
HuM&C reported a revenue of 12.5 billion won and an operating profit of 500 million won in the first quarter of this year.