[Edaily Reporter Kim Seung-kwon ] #Dong-A Socio Group is embarking on a restructuring centered on the holding company directly engaging in business operations. The plan is for Dong-A Socio Holdings, which had been a pure holding company, to directly absorb Dong-A Pharmaceutical—its core revenue source—to transform into an “operating holding company” and accelerate its expansion into the global healthcare market.

On the 23rd, Dong-A Socio Holdings(000640)announced that it held a board meeting and approved a resolution to merge with Dong-A Pharmaceutical, a wholly-owned subsidiary. The merger is scheduled to be finalized on October 1. This merger will take the form of a small-scale merger without the issuance of new shares. Accordingly, there will be no changes to Dong-A Socio Holdings’ ownership structure or the shareholdings of existing shareholders following the merger.

Since transitioning to a holding company structure in 2013, the Dong-A Socio Group has maintained a policy of independent management focused on developing the expertise of each affiliate over the past decade. Among these, Dong-A Pharmaceutical has served as the group’s reliable “cash cow,” expanding its business into over-the-counter (OTC) drugs, healthcare, and dermocosmetics, led by its iconic “Bacchus” brand.

However, as competition for dominance in domestic and international healthcare markets has recently intensified, the need for the group to rapidly establish a unified strategic framework has become apparent. The company explained that it decided to restructure in order to directly transfer Dong-A Pharmaceutical’s liquidity and business competitiveness to the holding company, thereby securing more proactive growth momentum.

Once the merger is complete, Dong-A Socio Holdings will transform from its current role of managing subsidiaries and identifying new business opportunities into an operating holding company that directly manages the consumer healthcare business.

Industry observers view this integration as an opportunity to streamline previously complex management procedures. With the management structure—which had been duplicated between the holding company and its subsidiaries—now unified under a single board of directors and executive team, the company is expected to respond much more quickly to market changes. The move is also expected to enhance the company’s value in the capital markets. Analysts note that by absorbing its wholly-owned, high-performing subsidiary, the company has addressed concerns regarding duplicate listings—which had been consistently raised in the market—and eliminated the “holding company discount,” thereby laying the groundwork for a revaluation of its corporate value.

Following the merger, Dong-A Socio Holdings plans to focus its efforts on overseas expansion, leveraging Sam-A Pharm. Co. Ltd.’s strong brand power and sales network. The strategy involves significantly increasing the proportion of overseas sales by actively diversifying e-commerce distribution channels, expanding presence in global retail chains, and collaborating with leading brands.

An official from Dong-A Socio Holdings stated, “This merger is a decisive step toward becoming a global leader, building on the achievements of the holding company structure we have cultivated over the past decade,” adding, “We will actively invest our consolidated capital and infrastructure into new growth engines to simultaneously boost corporate value and shareholder value.”