PharmaResearch announced on the 8th that it has withdrawn its plan for a spin-off and decided to suspend the partitioning process. This decision is the result of a review based on the opinions of shareholders and the market.
The company stated through a notice on its official website that, "While we appreciate the intent of the partitioning and the support for our global leap, there were various concerns about changes in governance, the potential erosion of shareholder value, and the sufficiency of communication, which we carefully accepted and prompted a review of this decision."
It was further noted that, "Through this process, we realized once again that decision-making in corporations is not sufficient based only on strategic needs or legal validity, and that more proactive and deeper trust-based communication with shareholders is important."
Earlier, on the 13th of last month, PharmaResearch's board of directors resolved to pursue a spin-off plan. The partitioning involved separating into a continuing corporation, PharmaResearch Holdings, which would handle investment, and a newly established company, PharmaResearch, which would focus on the existing aesthetic business. The company explained at the time that this decision was to enhance business specialization by dividing business segments such as pharmaceuticals, medical devices, and cosmetics and to reform the governance system for improved management efficiency and corporate value.
However, as the partitioning ratio between the holding company and the newly established business corporation was set at 74.28% and 25.72%, respectively, controversy arose over the perception that this was a move to strengthen the dominance of large shareholders, leading to questions of whether this constituted duplicate listings.
Son Ji-hoon, the representative of PharmaResearch, said, "While I understand that there are shareholders who empathized with the intention of establishing a holding company, I also acknowledge that this decision might feel disappointing for some," and added, "PharmaResearch humbly accepts various opinions and seeks to grow into a more shareholder-friendly corporation, so I ask for your understanding in this regard."
PharmaResearch has decided not to pursue a spin-off but will continue its existing management policy, aiming to accelerate its global aesthetic business centered in key markets such as the United States, Europe, Japan, and China, enhance investment functions within the existing organization, prepare for strategic mergers and acquisitions (M&A), and establish a transparent and sustainable governance system based on ESG and compliance.