Battery Company Kumyang to Pursue Rights Offering Worth 450.2 Billion Won

Decision and Announcement Made for Completion of Gijang Dream Factory 2

Expected Issue Price 38,950 Won... Employee Participation

Kumyang, a leading battery company based in Busan, is pursuing a paid-in capital increase worth approximately 450 billion KRW.

Kumyang announced on the 30th, "We decided on a paid-in capital increase of 450.2 billion KRW through a rights offering followed by a public offering of forfeited shares to finance facility investments and repay borrowings, and disclosed this on September 27."

A Kumyang official explained, "This paid-in capital increase is being carried out to secure the funds needed to enhance mass production capabilities along with the advancement of innovative battery technology," adding, "The scale of the capital increase is set to meet the company's needs while maximizing the protection of shareholder rights."

The official also said, "Through this capital increase, we aim to build a stable portfolio that will drive a rebound in our currently undervalued stock price by achieving full-scale mass production and sales, thereby creating momentum to maximize shareholder value," and encouraged shareholders' interest and participation.

The final issue price per share for this paid-in capital increase will be determined on November 27. The expected issue price is 38,950 KRW, and the record date for new share allocation is the 22nd of next month. The lead manager is BNK Investment & Securities, with Korea Investment & Securities, Hanyang Securities, and SK Securities also participating.

Kumyang initially considered appointing a securities firm headquartered in Seoul as the lead manager, but reportedly made a swift change when BNK Investment & Securities, an affiliate of Kumyang's main bank, BNK Financial Group, expressed interest.

On September 19, Kumyang signed a battery cell distribution and supply contract worth about 2.3 trillion KRW over six years with NanoTech Energy in the United States. To ensure the smooth supply of contracted volumes and proactively respond to additional contracts with global companies currently under negotiation, the timely completion of Dream Factory 2 in Gijang and the early operation of its production line are deemed absolutely necessary, leading to the decision to raise funds through a paid-in capital increase as the optimal financing method.

To prove the sincerity of this capital increase and confidence in the company's value, not only the major shareholders but also executives and employees will actively participate in this paid-in capital increase, targeting 160 billion KRW.

Regarding the capital increase, the company expressed its commitment to solidifying its position as a trustworthy company by realizing seamless production plans and profit generation based on a strong financial structure and stability.

A Kumyang official introduced, "A successful case of a paid-in capital increase is Samsung Electronics, which in 2018 raised about 25 trillion KRW through a new share issue to invest in its semiconductor and display businesses and successfully expanded its global market share."

In addition, Kakao raised its corporate value in 2020 by issuing new shares worth 1 trillion KRW for business expansion and M&A, and in the same year, LG Chem carried out a paid-in capital increase of about 1 trillion KRW to invest in its electric vehicle battery business, thereby securing competitiveness and achieving growth in the global battery market.

Overseas, Tesla, an American electric vehicle company, secured investment resources in the stock market by raising a total of about 14 billion USD (18.9 trillion KRW) through paid-in capital increases for initial operating funds up to 2020, leveraging its innovative technology.

Kumyang has presented its vision to become a global leader in the battery market with its innovative battery technology, having succeeded in developing the 4695 battery for the first time in Korea. The investment market is paying close attention to whether Kumyang will succeed in securing funds and financial stability through this paid-in capital increase.

On September 20th, a memorandum of understanding signing ceremony was held at Kumyang's Busan headquarters for the development and production of next-generation secondary batteries between Kumyang and Nanotec.