HLB Pharmaceutical (047920.KQ) has decided to conduct a 120 billion won rights offering to strengthen its pharmaceutical production base through the expansion of its new Hyangnam plant.
The company said Thursday that its board of directors approved the rights offering. The issuance will involve 10,762,332 common shares at an expected offering price of 11,150 won per share. The record date for new share allocation is set for July 1, 2026, with the payment date scheduled for August 19, 2026. The dividend accrual date for the new shares is January 1, 2026.
The offering will be conducted as a rights issue followed by a public offering of any forfeited shares. New shares will first be allocated to existing shareholders, and any unsubscribed shares will be offered to general investors. As a result, the actual amount of funds raised may vary depending on subscription results and the final offering price.
According to HLB Pharmaceutical, 55 billion won of the expected 120 billion won in proceeds will be invested in the construction of the new Hyangnam plant. Through the completion of the new facility and the introduction of state-of-the-art equipment, the company plans to substantially expand its annual production capacity from the current 300 million tablets to 700 million tablets, while increasing the proportion of in-house products to enhance production efficiency and cost competitiveness. The goal is to build a global production hub capable of manufacturing a wide range of drugs, including the liver cancer treatment rivoceranib.
Another 25 billion won of the proceeds will be used to strengthen research and development (R&D) capabilities. HLB Pharmaceutical plans to use these funds to accelerate the development of improved new drugs and the launch of first generics, while expanding the proportion of its own products.
"We plan to continue securing mid- to long-term growth drivers that will preempt future markets by accelerating the advancement of our core platform technology, the long-acting injectable formulation (SMEB), and the discovery of new pipelines," an HLB Pharmaceutical official said.
The 25 billion won allocated as operating funds will be used for the purchase of raw and auxiliary materials, payment of outsourced processing fees, and overall business operations. In addition, 15 billion won of the proceeds will be used to repay borrowings. Through this, the company aims to lower its debt ratio to strengthen financial stability and improve its financial structure.
"The new Hyangnam plant will become a core base symbolizing HLB Pharmaceutical's manufacturing competitiveness," the official said. "Through efficient execution of funds and proactive R&D reinforcement, we will complete our mid- to long-term growth roadmap without disruption and further strengthen our position in the market."
