Celltrion Group holding company Celltrion Holdings said on the 28th it plans to expand the size of its Celltrion share purchases to 700 billion won.
On July, Celltrion Holdings announced a plan to buy 500 billion won worth of Celltrion shares and has been proceeding with purchases, and it is increasing the size of the purchases.
According to the company, it will buy about 400 billion won worth of Celltrion shares by the end of this month. After completing the ongoing acquisition of about 150 billion won worth of shares, it plans to immediately push for an additional purchase of about 288 billion won.
The company said, "Once the additional purchases are completed, Celltrion Holdings will have acquired more than 800 billion won worth of Celltrion shares this year alone, including about 120 billion won worth of shares acquired in May."
Celltrion Holdings carried out the purchase of Celltrion shares based on the judgment that Celltrion's stock price is undervalued. The intent is for the holding company to demonstrate confidence in Celltrion's business growth to the market and to raise shareholder value.
The company explained, "Despite solid business fundamentals, as the merger with Celltrion Healthcare (dissolved entity) proceeded, we judged that there was temporary pressure on operating profit due to a short-term rise in the cost ratio and amortization of intangible assets, so we have continued open-market purchases to enhance shareholder value and minimize Celltrion's undervaluation." Celltrion absorbed Celltrion Healthcare on Dec. 28, 2023.
The company said, "Starting in the third quarter of this year, Celltrion will completely break free from operating profit pressure stemming from the merger," and projected that this will be the last additional share acquisition by Celltrion Holdings. However, it left room, saying that if Celltrion's undervaluation persists, it will consider expanding purchases up to 1 trillion won to enhance shareholder value.
A group official said, "Celltrion is setting new record sales in succession and securing U.S. production facilities, accelerating its rise to global big pharma," adding, "At the group level, we will also bolster active shareholder returns, do our best to share the fruits of growth with investors, and pursue joint growth."