LegoChem Biosciences, a prominent South Korean bio-venture with a rich history in new drug research and development (R&D), has marked a significant milestone by entering into a stock transfer agreement with the Orion Group. Having successfully concluded over 10 global technology export contracts, the company is poised to undergo a transformative acquisition.

On January 15th, LegoChem Biosciences announced that its CEO, Yong-Zu Kim, and Senior Vice President, Se-Jin Park, the largest shareholders, have agreed to transfer their respective company shares to Pan Orion Corp. Limited, a Hong Kong-based subsidiary of Orion. With Orion holding a 95.15% stake in Pan Orion Corp., the total value of the stock transfer stands at $58.87 million. CEO Yong-Zu Kim is set to sell 1.2 million shares, while Senior Vice President Se-Jin Park will sell 200,000 shares to Pan Orion Corp., with the transaction set to conclude on March 29th.

LegoChem Biosciences affirmed that despite this stock transfer, there will be no change in management control, ensuring the continued leadership of CEO Yong-Zu Kim and Senior Vice President Se-Jin Park. Pan Orion Corp. is expected to appoint directors and auditors, actively participating in the management during the upcoming regular shareholders' meeting.

Simultaneously, LegoChem Biosciences, in a board meeting on the same day, approved a third-party allocation of new shares to Pan Orion Corp. This involves the issuance of 79,632,830 common shares at a rate of $44.15 per share, raising approximately $351 million. The funds raised are earmarked for clinical trials, R&D expenses, and other operational needs. The subscription payment for the new shares aligns with the completion date of the stock transfer agreement, scheduled for March 29th. The newly issued shares are projected to be listed on April 23rd.

Following the stock transfer agreement's completion, Pan Orion will secure a 25.73% stake in LegoChem Biosciences, making it the largest shareholder on March 29th. The transition of LegoChem Biosciences' major shareholder to an affiliate of the Orion Group is expected to bring new momentum to R&D, with CEO Kim and Senior Vice President Park continuing to play key roles in the management.

Established in May 2006, LegoChem Biosciences is a bio-venture company dedicated to new drug development. It went public on the KOSDAQ market in May 2013. CEO Yong-Zu Kim, the largest shareholder, holds 2,426,428 shares (8.67% ownership) as of the end of the third quarter of 2023, while Senior Vice President Se-Jin Park owns 381,528 shares (1.36%). With other related parties, the total ownership of the largest shareholders is 10.49%. In this stock transfer, CEO Kim and Senior Vice President Park are set to convert approximately $50.4 million and $8.4 million, respectively, into cash by selling around half of their respective holdings. The issuance of new shares through a third-party allocation is expected to further dilute the ownership percentage of CEO Kim and Senior Vice President Park.