[Asia Economy Reporter Jang Hyowon] The payment date for the convertible bonds (CB) of Glovon, a KOSDAQ-listed company, has been delayed multiple times. According to KOSDAQ regulations, if the payment date is delayed for more than six months, there is a risk of penalty points, drawing market attention.
According to the Financial Supervisory Service's electronic disclosure on the 17th, Glovon changed the payment date for the 20 billion KRW 5th series CB, which was scheduled for issuance last November, to the 27th of this month.
Previously, on November 24 last year, Glovon announced the issuance of the 5th series CB worth 20 billion KRW. The nominal interest rate was 0%, the maturity interest rate was 3%, and the conversion price per share was 4,010 KRW. The purpose of fundraising was to acquire securities of other companies. They planned to acquire companies related to new businesses such as parts and materials.
The bond issuance target was a corporation named Easy Signal Korea. As of the end of 2020, this company had assets of 170 million KRW. It is presumed that they intended to acquire the 20 billion KRW CB through borrowing.
The payment date for this CB was November 30 last year. However, when the payment date arrived, Glovon postponed it to December 31 last year. Then, on December 31, the payment date was changed to April 29 this year. On April 29, the payment date was further postponed to the 13th of this month, while the conversion price was lowered to 3,205 KRW and the nominal interest rate was raised to 1%.
The issuance targets were also changed to Christ Investment Association (10 billion KRW) and SLS Investment Association (10 billion KRW). Christ Investment Association's largest investor is Shin Hee-jung, holding 90%, and SLS Investment Association's largest investor is Shin Sung-kyun, holding 90%.
By postponing the payment date four times since the initial CB issuance decision, about six months have passed since the original payment date, increasing the risk of being designated as a non-compliant disclosure company. In the KOSDAQ market, if the CB payment date is delayed by more than six months, the company is designated as a non-compliant disclosure company and penalty points are imposed.
Glovon is in urgent need of capital injection to advance its business. Glovon operates cosmetics businesses such as 'RUE KWAVE'. Since 2018, it has recorded operating losses every year, and in the first quarter of this year, it posted sales of 4 billion KRW and an operating loss of 2.1 billion KRW. If it fails to achieve a turnaround this year, it may be designated as a management item.
They also attempted to enter new businesses but faced difficulties. In January last year, Glovon acquired a 51% stake in 'Green Science', a company engaged in the development and manufacturing of secondary battery-related products and wastewater and exhaust gas treatment.
However, Green Science's sales plummeted from 7.1 billion KRW in 2020 to 150 million KRW last year. Consequently, Glovon exercised the stock sale request right against Green Science's CEO and terminated the management rights transfer contract.
Meanwhile, attempts to contact Glovon regarding the CB payment delay and new business inquiries were unsuccessful.
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