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Three-way merger scenario not yet confirmed: Celltrion affiliates

South Korean biopharmaceutical firm Celltrion’s key affiliates said Friday they have yet to set a clear blueprint in regards to Chairman Seo Jung-jin’s hint at the blockbuster merger of Celltrion, Celltrion Healthcare and Celltrion Pharm by as early as 2021.

“The company is considering the merger plan on the premise of shareholder agreement, but we have yet to make any confirmation as to how and when the merger would be undertaken,” the three firms said in respective disclosures.

Celltrion affiliates are obliged to disclose progress in the deal within a month.

Celltrion Chairman Seo Jung-jin speaks during the annual JP Morgan Healthcare Conference in San Francisco on Wednesday (Joint Press Corp)
Celltrion Chairman Seo Jung-jin speaks during the annual JP Morgan Healthcare Conference in San Francisco on Wednesday (Joint Press Corp)
The news came a day after Seo told press Wednesday at the JP Morgan Healthcare Conference in San Francisco that he was willing to merge the biopharma group’s crown jewel Celltrion with drug distributor Celltrion Healthcare and generic arm Celltrion Pharm “upon the request of shareholders.” He also expressed confidence in a quantum jump in revenue upon the merger taking place.

The remark came in line with Seo’s mention in the press conference in January 2019 that the merger of three units is up to shareholders’ will.

The Korea Exchange, operator of the stock market where shares in the three companies trade, on Thursday demanded Celltrion affiliates’ clarification by Friday at 12 p.m.

All three companies’ stock prices drifted lower Friday. At 2 p.m. Celltrion was trading 3.3 percent lower, Celltrion Healthcare was 0.3 percent lower and Celltrion Pharm fell 3.9 percent.

A day prior, Celltrion Pharm soared 19.3 percent and Celltrion Healthcare rose 6 percent.

Celltrion is a key affiliate of Celltrion Holdings, the biosimilar developer’s top holding firm controlled by Seo. Celltrion owns a controlling 54.99 percent stake in Celltrion Pharm, while Seo holds 35.69 percent of shares in Celltrion Healthcare.

The three companies’ combined market cap stands at 31.9 trillion won ($27.5 billion).

Celltrion sells biosimilar drugs including Remsima, Truxima and Herzuma.

By Son Ji-hyoung (consnow@heraldcorp.com)
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