Global private equity fund (PEF) giant Bain Capital has agreed to buy nearly half of stakes in South Korean biopharmaceutical firm Hugel Inc. at 927.2 billion won ($817 million) to become the Korean company’s largest stakeholder.
Hugel said on Monday that its shareholders voted in favor of issuing new shares and convertible bonds worth 454.7 billion won in total for Bain Capital during a board of directors meeting held on Sunday. An additional 24.36 percent stake held by its largest shareholder Tongyang HC will also be taken over by the U.S.-based PEF at 472.7 billion won, making the total sale transaction to reach 927.2 billion won. Once the transactions are completed, Bain Capital will become Hugel’s largest shareholder with an about 45 percent stake.
Established in 2001, Hugel is a Korean biopharmaceutical company that manufactures botulinum toxin and dermal facial filler used for beauty and cosmetic surgery injections to minimize wrinkles. It posted 63.2 billion operating profit on sales of 124.1 billion last year, both more than doubling from a year ago period.
Hugel expects that U.S.-based Bain Capital’s bet on it will pave the way for the company to expand its presence overseas. Stada Arzneimittel AG, German leading pharmaceutical company that was taken over by Bain Capital and Cinven earlier this month, is expected to create synergies with Hugel since Stada has been marketing Hugel’s products in Europe.
Carver Korea, Korean cosmetics company that Bain Capital acquired together with multinational investor Goldman Sachs Group Inc. last year, is also expected to help Hugel make headways in the beauty market.
Shares of Hugel ended Tuesday at 420,000 won, up 24,000 won or 6.06 percent from the previous session in Seoul trading.
By Kang Doo-soon and Shin Chan-ok
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