Kangstem Biotech is showing weakness in early trading on 11th. Investors appear to be dumping shares due to concerns about adverse effects on stock prices following the announcement of a large-scale capital increase plan the previous day.
As of 9:11 a.m. on that day, Kangstem Biotech is trading at 1,604 won, down 481 won (23.07%) from the previous trading day.
On 10th, Kangstem Biotech announced a plan for a rights offering totaling 38 million shares. This represents a large-scale capital increase amounting to approximately 67.8% of the existing 56 million listed shares. The total funding size amounts to 48.185 billion won.
Kangstem Biotech noted that the new funding would be used for the research and development (R&D) expenses of osteoarthritis treatment and atopic dermatitis treatment, as well as for adipose stem cells and organoids (mini-organs). However, investors view the large scale of the capital increase and the distribution of all shares to shareholders without tri-party allocation as a negative factor.