[Market Focus] Seongho Electronics Hits Upper Limit for Second Day on ADS Tech Acquisition News

Seongho Electronics showed strong performance in early trading.

As of 9:10 a.m. on December 9, Seongho Electronics surged by 29.79% (1,150 KRW) compared to the previous day, hitting the upper price limit (5,010 KRW) for the second consecutive day.

This rally is attributed to the company's announcement after the market closed the previous day that it would acquire an 87.5% stake (350,000 shares) in ADS Tech, an optical communication equipment company, for 280 billion KRW. The size of the stake to be acquired is equivalent to 76.23% of Seongho Electronics' total assets (367.3 billion KRW) and 182.44% of its equity capital (153.5 billion KRW) as of the end of last year.

The purpose of the acquisition is to secure a controlling stake and diversify its business portfolio. The scheduled acquisition date is January 16 next year.

On the same day, Seongho Electronics also issued convertible bonds worth 50 billion KRW to raise funds for acquiring securities of another company. In addition, the company announced the issuance of bonds with warrants worth 30 billion KRW to raise 10 billion KRW for operating funds and 20 billion KRW for acquiring securities of another company.