On October 1, CreoSG announced its decision to implement a 2-for-1 reverse stock split, merging two existing shares into one.
As a result of this capital reduction, the company’s capital will decrease from approximately 97.6 billion won to about 48.8 billion won, with the reduced capital being used to offset accumulated deficits. If shareholders approve the management’s decision at the general meeting scheduled for November, it is expected that by March 2026, when the 2025 audit report is submitted, CreoSG will avoid the worst-case scenario of being designated as an administrative issue and will also be removed from the investment caution list.
Since the beginning of 2024, CreoSG has been working to enhance shareholder value by transforming itself into a bio-business company. The company changed its name from Kurocom to CreoSG and appointed Dr. Lee Sangkyun, a bio-industry expert, as CEO. The company has begun full-scale production of clinical phase 2 samples for its AIDS vaccine, which succeeded in phase 1 clinical trials with the U.S. FDA in 2013. At the same time, CreoSG has strengthened its vaccine pipeline through collaborations with the International Vaccine Institute (IVI) and Alteogen, utilizing SUV-MAP (Sumagen rVSV Multifunctional All Platform), and has also sought to expand into the immuno-oncology market.
In June of last year, the company merged its subsidiary Immunovax Bio (formerly Sumagen) so that the bio-business previously operated by the subsidiary is now managed as a business division within CreoSG. Through this merger, the corporate structure was reorganized to ensure that profits from ongoing developments-such as the AIDS vaccine, Severe Fever with Thrombocytopenia Syndrome (SFTS) vaccine, Hemorrhagic Fever with Renal Syndrome (HFRS) vaccine, and immuno-oncology drugs-would benefit CreoSG shareholders.
To support these bio projects, CreoSG conducted a shareholder priority public offering in the second half of 2024, with the largest shareholder Kuro Holdings and the second-largest shareholder K Partners fully subscribing to their allotted shares. However, due to accounting principles requiring that development costs before phase 3 clinical trials and merger-related expenses be treated as expenses rather than assets, the capital structure of CreoSG deteriorated after the merger, as these development costs were deducted from capital as losses.
In the first half of 2025, CreoSG attempted to raise 10 billion won through a paid-in capital increase to support its bio-business and strengthen its capital base, but was unable to complete the capital increase due to investors withdrawing or changing their investment intentions. In September, the second-largest shareholder K Partners participated only in a small public offering worth 1 billion won. As a result of these failed capital-raising efforts, the capital impairment ratio rose from 47.7% at the end of last year to 53.0% at the end of the first half of 2025, and the company was designated as an investment caution stock.
The company explained that, since there is a high possibility of being designated as an administrative issue in early 2026 when the 2025 financial statements are disclosed, which could result in further shareholder losses, it was inevitable to decide on the reverse stock split on this day in order to complete the capital reduction process within 2025 and be removed from the investment caution list by March 2026.
A CreoSG representative stated, "Production of the clinical phase 2 vaccine for the U.S. FDA is progressing smoothly at the French global contract manufacturing organization (CMO) Naobios, and we are making thorough preparations so that clinical phase 2 trials can begin as soon as vaccine production is completed. In addition, the development of next-generation immuno-oncology drugs in collaboration with Alteogen is expected to begin in earnest soon, and we are also pursuing overseas sales of our bio-business, including Sumagen Canada. As a result, we anticipate an increase in shareholder value in the future."
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