As Huons Group pursues mergers and acquisitions (M&A) and a global expansion strategy with the goal of achieving 1 trillion won in annual sales, attention is also turning to its funding and governance strategies centered on the holding company, Huons Global.
Analysts say the financial moves, including the expansion of the third generation's management participation and equity transfer, and the issuance of exchangeable bonds (EB) using treasury shares, may be groundwork with mid- to long-term succession in mind.
The predecessor of Huons Group was Gwangmyeong Pharmaceutical Industrial Company, founded in 1965 by founder and first chairman Yoon Myung-yong. It localized dental local anesthetics. In 1997, when Honorary Chairman Yoon suddenly passed away, his then-33-year-old son, Chairman Yoon Sung-tae, succeeded to management control. It was a time when funding pressure coincided with the IMF financial crisis. Chairman Yoon Sung-tae retained the titles of president and vice chairman after his father's death and became chairman in 2022.
◇ As many as 13 affiliates, "external growth" achieved by the second-generation owner
Chairman Yoon grew the company from just 6 billion won in annual sales in 1997 to 813.5 billion won in 2024. By shifting from glass ampoule injections to plastic injections, it won strong support in medical settings, and it achieved major success in the early 2000s by launching obesity injections, vitamin injections and more for the first time in Korea.
Chairman Yoon expanded the business scope through active mergers and acquisitions (M&A). In 2010, it acquired Humedix, a bio company specializing in hyaluronic acid (HA) fillers. At the time, there was much skepticism when Huons, whose sales were under 100 billion won, acquired Humedix, which had tens of billions of won in accumulated losses. However, Humedix was listed on KOSDAQ four years after the acquisition and expanded into South American countries such as Brazil as well as Asia. In 2024, Humedix recorded annual sales of 161.9 billion won and operating profit of 43.1 billion won.
Currently, under the holding company Huons Global, Huons Group has three listed affiliates—Huons, Humedix and HuM&C—and 10 unlisted affiliates including Huons Meditech, Huons Biopharma and PanGen Biotech.
It also completed a transition to a holding company. After a spin-off, Huons Global launched in 2016 as a holding company. Huons Global oversees group-wide investment, finance and governance, and under it, 13 affiliates handle pharmaceuticals, medical devices, aesthetics, biopharmaceutical research and development (R&D) and health functional foods. The holding company Huons Global is jointly led by Chairman Yoon and CEO Song Soo-young, a professional manager from Deloitte Touche Tohmatsu Limited (DTTL), while affiliates including Huons are run by professional managers.
Huons is a core operating company that produces and sells prescription and over-the-counter drugs, including the local anesthetic "lidocaine" injection exported to the United States. It also distributes medical devices such as continuous glucose monitors. HuM&C produces glass containers and lenses for pharmaceuticals and cosmetics, and also engages in cosmetics components and OEM·ODM businesses. PanGen Biotech, acquired at the end of 2024, produces biosimilars and clinical active pharmaceutical ingredients.
Through aggressive M&A, it built a vertically integrated healthcare value chain spanning finished pharmaceuticals, APIs, containers and components, medical devices, and bio R&D, achieving external growth. Huons Global's consolidated sales were 574.6 billion won in 2021, about 664.3 billion won in 2022, about 758.3 billion won in 2023 and about 813.4 billion won in 2024, growing every year. For the cumulative first to third quarters of 2025, sales were 622.9 billion won, up about 2% year over year, and operating profit rose 0.6% to 71.2 billion won.
◇ Return to management followed by equity expansion… groundwork for mid- to long-term succession
The market expects management control to pass on following the shift to a holding company. Korean corporations have used the strategy of establishing holding companies to reduce the heavy gift and inheritance tax burdens that arise during succession. This is because the holding company's equity alone can provide a foundation to stably control the group as a whole.
An industry official said, "If, like Huons, you vertically integrate core profit-generating operating companies under a holding company, you can expect both business synergies and performance defense," adding, "This supports the holding company's dividend capacity and creates a structure in which cash flows stably accrue to the holding company."
The largest shareholder of Huons Global is Chairman Yoon, who holds 43.84% equity. Chairman Yoon stepped down from the CEO post at Huons Global in 2022, then returned to the front line of management last year to oversee the group as a whole.
In practice, the three sons, centered on the eldest, are gaining a stronger footing. The eldest son, Yoon In-sang, executive vice president of Huons Global, was promoted to executive director in Jul. 2024 and then to executive vice president in Jul. last year. Yoon's equity stake in Huons Global is 4.63%, expanded after he received 60,000 shares of Huons Global as a gift from Chairman Yoon in Feb. last year.
The second son, Yoon Yeon-sang, head of strategy at Humedix, who holds a 3.02% stake in Huons Global, joined the board for the first time when he was appointed an inside director at Humedix in Mar. last year. The third son, Yoon Hee-sang, who is reportedly working at Huons Foodience, holds a 2.73% stake in Huons Global and is not a registered executive. The second and third sons also received gifted shares alongside the eldest, increasing their stakes. The third generation owner family's equity transfer remains limited in scale for now. However, some in the market interpreted the moves as being made with succession in mind.
◇ Paying down debt with treasury share EBs while maintaining dividends… criticism over protecting succession funds
However, the financial position of the holding company Huons Global, which would underpin succession, is not easy. On Nov. 25 last year, Huons Global finalized the issuance of exchangeable bonds (EB) secured by 360,158 treasury shares. Under terms of "0% coupon and 0% yield to maturity," it raised external funds. By using treasury shares to grant investors equity conversion rights, it secured more than 20 billion won in large-scale funding without interest costs.
Unlike convertible bonds (CB) or paid-in capital increases that involve issuing new shares, EBs using existing treasury shares have the advantage of not causing dilution of the total number of shares.
The company said it was a decision that considered both securing financial soundness and protecting shareholder value. At the time, Huons Global disclosed that its main purposes were to repay facility funds and secure operating funds.
In fact, Huons Group faced the burden of repaying about 114.7 billion won in facility loans borrowed from institutions such as the Korea Development Bank, with 9.2 billion won due each quarter. The company said it used all funds raised through the EB issuance to repay debt, which will save about 240 million won in annual interest expense.
As large-scale investments continued, including building the group's integrated R&D hub "Dongam Research Institute" in Gwacheon Knowledge Information Town, the net debt ratio surged from 4.4% in 2021 to 15.9% in the first half of last year. Without a credit rating, issuing corporate bonds would have required bearing a high interest rate in the high-6% range, and even the headquarters building was pledged as collateral, making additional loans difficult. Amid high interest rates and a liquidity crunch, the card Huons chose after much consideration was EBs based on treasury shares.
There is another view. Explaining the background of the EB issuance, the company said, "If we include the 6.6 billion won in quarterly cash dividends scheduled for Dec. last year, we lack the capacity to repay debt." In response, some in the market criticized that, at a time when cash is short and the company is borrowing, maintaining dividends and raising funds by pledging treasury shares may also be aimed at protecting dividend income as succession funds for the owner family.
In response, Huons Group emphasized, "This EB issuance was a financial decision unrelated to management succession."
Group insiders said that as the company expands into new drug development and bio fields, it is focusing on securing future growth engines rather than succession. Along with building the Huons Dongam Research Institute in Gwacheon, it also reorganized its research and development (R&D) organization and infrastructure. In Oct. 2024, it hired Park Kyung-mi, executive vice president of Genome & Company, who oversaw clinical development at Hanmi Pharmaceutical, CHA Biotech and Chong Kun Dang pharmaceutical, as head of new growth R&D.
A Huons Group official said, "We are focusing on building global competitiveness across various healthcare fields, including pharmaceuticals, biopharmaceuticals and medical devices, centered on R&D."