[E-Daily Reporter YU JIN-HEE ] KOSDAQ-listed company KMPHARMACEUTICAL Co.,Ltd.(225430)has embarked on a capital expansion plan through a personal investment by its largest shareholder and CEO. This move reflects management’s strong commitment to maximizing the company’s undervalued enterprise value and firmly establishing a system of responsible management.

KMPHARMACEUTICAL Co.,Ltd. announced on the 14th that it has decided to conduct a 1 billion won third-party private placement, with CEO Baek Seung-won participating directly. Approximately 908,265 new shares will be issued through this private placement. The capital increase will be carried out by CEO Baek personally contributing his own funds to acquire the entire lot of new shares.

Following the capital increase, KMPHARMACEUTICAL Co.,Ltd.’s total number of issued shares will increase from the current 5,577,410 shares to 6,485,675 shares. Through this acquisition of new shares, CEO Baek’s stake is expected to expand significantly from the current 1.68% to approximately 15.45%. This move is seen as laying the groundwork for stabilizing management control and further strengthening responsible management. The new shares issued through this capital increase are scheduled to be listed on the 7th of next month.

CEO Baek emphasized, “KMPHARMACEUTICAL Co.,Ltd.’s current market valuation is excessively undervalued compared to the company’s intrinsic value,” adding, “My participation in this rights offering is a strong demonstration of my commitment to enhancing corporate value and will serve as the first step in a series of measures we are preparing to maximize shareholder value.”

Capital market experts are offering positive assessments of CEO Baek’s actions. KMPHARMACEUTICAL Co.,Ltd. had already held an extraordinary general meeting of shareholders last June and proactively revised its regulations on executive severance pay. The company completed administrative measures to enhance management efficiency and practice responsible management by voluntarily lowering the severance pay multiplier for the CEO.

Furthermore, it is noted that the CEO personally injected 1 billion won into the company, thereby enhancing corporate credibility. The funds raised through the rights offering will be focused on improving KMPHARMACEUTICAL Co.,Ltd.’s medium- to long-term financial health. The company plans to use the raised funds as working capital to pursue new growth initiatives and secure cash liquidity.

In particular, the company is investing in production facilities to take its competitiveness in the original equipment manufacturing (OEM) and original design manufacturing (ODM) businesses—which have recently been gaining momentum—to the next level. Alongside this, the company intends to accelerate its earnings recovery by making bold investments in cultivating its own life care brand and developing proprietary new products.

CEO Baek stated, “We are meticulously formulating and implementing detailed measures to dramatically restore our financial soundness,” adding, “Going forward, we will expand our channels of communication and swiftly implement necessary measures to firmly maintain a relationship of trust with our shareholders and capital market investors.”