Investment Policy for New Businesses in Pharmaceutical and Bio Sectors
On the 14th, Chairman Lee Woo-hyun is speaking at the 1st anniversary press conference of OCI Holdings. Photo by OCI Holdings
OCI Group is considering mergers and acquisitions (M&A) targeting pharmaceutical companies in the United States and Southeast Asia.
On the 14th, at a press conference marking the first anniversary of OCI Holdings held at the OCI Building in Jung-gu, Seoul, OCI Group Chairman Lee Woo-hyun stated, "We are currently looking at pharmaceutical companies in the U.S. and Southeast Asia from an M&A perspective," adding, "The U.S. companies will be valued at over 1 trillion KRW, and Southeast Asian companies will have a market capitalization of over 500 million USD (approximately 680 billion KRW)."
He emphasized, "It is still undecided whether the merger will be done through a capital increase or by acquiring shares," and added, "We will not collaborate with financial investors (FI) who have put options (sell rights)."
Chairman Lee reaffirmed OCI Holdings' commitment to expanding investments in the pharmaceutical and bio sectors to discover new growth engines. He said, "It remains an unchanging fact that we must continue to invest and strive in the pharmaceutical and bio fields." He also mentioned, "The integration with Hanmi did not proceed as planned, and reflecting on why it failed, we intend to approach more cautiously. Although I cannot disclose details until the deal is finalized, we are making efforts to achieve proper results this time, even if it takes time."
Earlier, OCI Holdings and Hanmi Pharmaceutical Group agreed and signed a contract on January 12 for group integration through each company's contribution in kind and new share issuance acquisition. However, the integration was canceled after five individuals from the opposing faction, including the founder’s eldest and second sons, Lim Jong-yoon and Jong-hoon, were appointed as board members.
Regarding industries or companies considering new businesses centered on pharmaceuticals and bio, Chairman Lee said, "We will focus on sectors where investments can be paid back within five years and generate an operating profit margin of over 20%, primarily targeting the U.S. and Southeast Asia, where we mainly operate." He added, "The new growth engines we are currently reviewing are pharmaceuticals, bio, solar energy, and semiconductors," and noted, "The pharmaceutical and bio businesses will be examined with a focus on overseas markets."
Specifically, OCI is maximizing business capabilities across the solar value chain centered on polysilicon for solar power produced by its Malaysian subsidiary OCIM in the energy solutions sector. In the chemical sector, OCI plans to continue investing to expand its business into advanced materials such as semiconductors and secondary batteries, based on its operating company OCI.
He emphasized the continuous growth of the solar market. Chairman Lee explained, "When we started the polysilicon business in 2006, the global solar power generation capacity was 0.5 gigawatt-hours (GWh)," adding, "The expected capacity by 2030 is about 1000 GWh, which will be significantly larger." He further noted, "The solar market is growing at 15% annually, so capturing even a portion of this market will greatly benefit our performance."
OCI recently took its first step as a semiconductor materials company through a joint venture (JV) with Tokuyama in Japan. Through the regional headquarters ‘RHQ’ opened last month in Kuala Lumpur, Malaysia, OCI plans to expand its business with Southeast Asia as a base.
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