Biolog Device Issues CB Refinancing Due to Stock Price Decline [Fundraising]

[Asia Economy Reporter Jang Hyowon] BioLog Device, a KOSDAQ-listed company, is issuing convertible bonds (CB) to refinance previously issued CBs. This is interpreted as due to the difficulty of converting the existing CBs into shares caused by a decline in the stock price.

According to the Financial Supervisory Service's electronic disclosure on the 19th, BioLog Device announced that it decided to issue the 5th series CB worth 6.5 billion KRW on the same day. The issuance targets are SangSangIn Savings Bank and SangSangIn Plus Savings Bank. The purpose of issuance is to repay the previously issued 4th series CB.

BioLog Device issued the 4th series CB worth 15 billion KRW in May last year. The issuance targets of this CB were also SangSangIn Savings Bank and SangSangIn Plus Savings Bank. This CB became eligible for redemption or conversion into shares starting from May, one year after the issuance date. However, SangSangIn did not request stock conversion.

This is interpreted as the conversion price of the 4th series CB being higher than the market price. The initial conversion price of this CB was 3,086 KRW. Although the conversion price was adjusted down to the lowest refixing price of 2,161 KRW, which is 70% of the original, it remains higher than the current stock price. As of this day, BioLog Device's stock price is around 1,400 KRW.

The conversion price of the newly issued 5th series CB is 1,505 KRW. The lowest adjusted price is 1,054 KRW. The conversion price was lowered compared to the 4th series. On the other hand, the interest rate was raised. The 5th series has a coupon rate of 3% and a maturity rate of 6%, whereas the 4th series had a coupon rate of 2% and a maturity rate of 5%.

This refinancing is analyzed to be due to a decline in the collateral ratio. The 4th series CB is secured by 9.6 billion KRW in cash and CBs worth 3 billion KRW. Initially, BioLog Device provided 2.64 million shares of Haesung Optics, which it had planned to acquire, as collateral, but after canceling the acquisition, it pledged 12.6 billion KRW in cash as collateral. Later, in April, the collateral was changed to the current conditions.

Meanwhile, the newly issued 5th series CB is secured by CBs worth 3 billion KRW of Seba Biotech. Seba Biotech is a skin-derived microbiome company in which BioLog Device invested last April.