Green Cross Sells off All Its Holdings in Ildong Pharma
Green Cross Corp. said on May 29 that all the shares of Ildong Pharmaceutical held by itself and its subsidiaries including Green Cross Holdings and Green Cross Cell were sold to Yoon Won-young, Ildong Pharmaceutical chairman. The company explained the latest sell-off was intended to accelerate its businesses overseas including in North America and China.
A Green Cross Corp. official said, "Both Green Cross and Ildong made a win-win decision in view of each other's strategy. By simplifying the ownership structure of both companies, we will try to focus more on global business currently under way." The deal involved the sale of 7,359,773 shares (29.36% stake) to the chairman. The deal's value is estimated at 139.8 billion won.
Separately, Green Cross Corp. will soon break the ground for a Canadian plant for its plasma derivatives as a way to expand into the North American market. In addition, its IV-Globulin SN, an injectable drug for treating immunodeficiencies and Alzheimer's disease, is set to apply for approval with the U.S. Food and Drug Administration.
Beginning in 2012, Green Cross has acquired in piecemeal the shares of Ildong Pharmaceutical at the total cost of 73.9 billion won. Although the company assured the shareholders of Ildong that its moves were intended for maintaining "amicable business relationship," it sent out a shareholder proposal that demanded appointment of board of directors representing Green Cross's interest, which triggered a dispute surrounding management control.
Earlier in March this year, however, Fidelity Asset Management, the third largest shareholder to Ildong with a 8.99-percent stake, took the side of Ildong management, thwarting the attempt by Green Cross to take over the control. Analysts interpreted the latest decision by Green Cross to sell off all its holdings in Ildong as a move for profit-taking as its aim to overtake the control was unsuccessful.