Shares of DXVX (397030.KQ), a Korean biotech company, closed sharply higher on Wednesday after the company announced that its largest shareholder would participate in a capital increase, easing concerns over capital impairment.
DXVX rose 10.38% to close at 2,500 won on the KOSDAQ market on January 23. The company disclosed the previous day that it would conduct a third-party allocation rights offering of approximately 100 billion won ($74 million) to its largest shareholder, Lim Jong-yoon, chairman of Korea Group.
The new shares will be issued at 2,027 won, a 20% premium to the reference price. The funds will be used for operating expenses and facility investments. The newly issued shares are subject to a one-year lock-up period.
DXVX said the capital raise would resolve concerns about complete capital impairment while securing a stable financial foundation to accelerate new drug development.
"Based on strengthened financial soundness, we will focus on advancing new drug development outcomes next year, including license-out deals with global companies, to enhance shareholder value," a company official said.
