Hanwha Aerospace decided on a large-scale paid-in capital increase, and its stock price continued to soar, leading to an increase of more than 600 billion won in the expected amount of funds that can be raised through the capital increase.
Hanwha Aerospace announced on the 21st that the initial issuance price for the new shares from the paid-in capital increase has been set at 684,000 won. The initial issuance price was determined based on the discounted 15% applied to the one-month weighted average stock price (trading volume ÷ transaction value) from the previous day, as well as the one-week weighted average stock price and the closing price on the day of calculation.
Hanwha Aerospace is pushing ahead with the paid-in capital increase by issuing 4,267,200 new shares allocated to existing shareholders and subsequently conducting a public offering for general investors if any unallocated shares arise. The initially planned issuance price was 539,000 won, and the amount of funds that Hanwha Aerospace expected to raise through the capital increase was about 2.3 trillion won.
However, based on the initial issuance price, Hanwha Aerospace can secure about 2.92 trillion won from this capital increase. The stock price has risen about 13% since Hanwha Aerospace announced the capital increase in March. Hanwha Aerospace allocated an additional 620 billion won of the increased funding to acquire securities from other companies.
A source in the financial investment industry noted, “The Financial Supervisory Service rejected the securities registration statement related to Hanwha Aerospace’s capital increase, which delayed the schedule, but looking at it from the current perspective, it has actually been beneficial.”
The confirmed issuance price for Hanwha Aerospace’s capital increase will be based on the lower of the second issuance price calculated with the 26th of next month as the base date and the first issuance price. If Hanwha Aerospace's stock price stays above 800,000 won, the first issuance price will become the confirmed issuance price. Conversely, if it falls below 800,000 won, the second issuance price based on that will be confirmed.
However, if Hanwha Aerospace's weighted average stock price is above 1.14 million won from the 24th to the 26th of next month, the funds available for this capital increase will further increase. Currently, securities firms suggest an average target stock price of 992,000 won for Hanwha Aerospace. Korea Investment & Securities and Mirae Asset Securities have set target stock prices of 1.3 million won and 1.2 million won for Hanwha Aerospace, respectively.