[Funding] ZenenBio①, Seeking Growth Momentum Through Large-Scale Capital Increase

Allocation of 0.14 New Shares per Old Share in Guju... Expected Fundraising of 51.6 Billion KRW
289 Billion KRW for Primate Nonclinical Testing Center Construction
11.7 Billion KRW Remaining Payment for Land Purchase in Gyeongsan Knowledge Industry District Landfill Site

[Asia Economy Reporter Hyungsoo Park] ZenenBio has begun raising funds to actively develop xenotransplantation. They plan to build a large-scale nonclinical primate testing facility on the site of the Pyeongtaek Dream Tech Industrial Complex.

According to the Financial Supervisory Service's electronic disclosure system on the 20th, ZenenBio is pursuing a paid-in capital increase through a rights offering allocating 0.14 new shares per existing share, followed by a general public offering of forfeited shares. The planned issue price per new share is 3,820 KRW, and a total of 13.5 million shares will be issued.

They will raise 51.6 billion KRW, of which 28.9 billion KRW will be invested in establishing the primate nonclinical testing center. Conducting nonclinical trials is the first step in developing xenotransplantation. International organizations such as the International Xenotransplantation Association (IXA) and the World Health Organization (WHO) require that primate nonclinical trial results must be attached before entering clinical trials during the xenotransplantation development process.

ZenenBio explained that it is difficult to find a contract research organization (CRO) capable of performing surgeries that transplant xenotransplants processed and extracted from pigs into primates. They expect that directly conducting primate nonclinical trials will accelerate the development of xenotransplantation. They also plan to operate a CRO business that conducts primate nonclinical trials on behalf of biopharmaceutical and antibody therapeutic developers.

In March, ZenenBio established ZenenResources jointly with the UK company Organ Preservation Solutions to develop transgenic pigs and promote related businesses. They will invest 5 billion KRW for ZenenResources' research and development and stable management activities.

Additionally, of the funds raised through the capital increase, 11.7 billion KRW will be used to purchase landfill sites within the Gyeongsan Knowledge Industry District. Previously, in May 2017, ZenenBio merged on a small scale with Gonggam E&T, which operates a waste landfill in Gyeongju. As of June this year, the remaining landfill volume at the Gyeongju waste landfill is only 53,504 tons. With landfill expected to end in the first half of next year, the business cannot continue without securing a new landfill site. ZenenBio signed a sales contract for 52,661 square meters of waste treatment facility land in the Gyeongsan Knowledge Industry District, located in Daehak-ri, Hayang-eup, and Sowol-ri, Wachon-myeon, Gyeongsan-si, Gyeongsangbuk-do, with Gyeongsan Knowledge Industry Development. The remaining payment of 11.7 billion KRW must be made by the end of this year.