L&C Bio (290650) is accelerating an expansion of its production base after completing the existing-shareholder subscription for a rights offering worth about 144.7 billion won ($101 million). The company plans to invest more than 70% of the proceeds in an integrated production and research and development center in Dongtan to support its overseas expansion.
L&C Bio said on the 16th that the existing-shareholder subscription, held on the 14th and 15th of this month, drew a subscription rate of 103.92% including oversubscriptions. Applications covered 3,845,212 shares, exceeding the 3.7 million shares planned for issuance. The subscription amount reached about 150.35 billion won, surpassing the 144.67 billion won target. As a result, the company will not conduct a separate public offering of unsubscribed shares.
Of the expected proceeds, the company will channel 105 billion won into a global integrated production and R&D center it is building in Dongtan, Hwaseong, Gyeonggi Province. The Dongtan center is intended to expand production capacity for human tissue grafts and human tissue-based medical devices, and to bring production, quality control and R&D functions together at a single site. The remaining 24.67 billion won will be used as operating funds, including raw material purchases, and 15 billion won will go toward debt repayment.
The investment in production facilities is aimed at lifting supply capacity in line with growth in flagship products such as Rituo, a human-derived extracellular matrix (ECM) product. L&C Bio's consolidated revenue in the first half of this year was 69.1 billion won, up 80.6% from a year earlier, and operating profit turned positive at 14.6 billion won. Revenue from human tissue grafts, including Rituo and MegaDerm, jumped 89.0% to 48.1 billion won.
Expanding overseas sales is also adding to the need for greater capacity. The company currently exports and sells Rituo in markets including Japan and Singapore, and has secured formal approvals in Thailand and Peru. More recently it obtained an import license in the United Arab Emirates and signed an exclusive supply agreement with a local partner in the U.S., broadening its sales base.
An L&C Bio official said the company will "execute the proceeds according to plan to strengthen production competitiveness, and link our global business expansion to revenue and profit growth to meet shareholders' expectations."
The payment date for the rights offering is the 22nd of this month, and the new shares are scheduled to list on Nov. 4. Following the rights offering, the company will also carry out a bonus issue allocating one new share for each common share held. The record date for the allocation is the 27th of this month, and the new shares from this rights offering will also carry allocation rights. The bonus shares are scheduled to list on Nov. 12.