Korea's stock issues in April surge on Samsung Biologics' rights offering

Equity issuance by Korean Inc. in April more than tripled from the previous month on Samsung Biologics’ 3.2 trillion won ($2.5 billion) rights offering to finance M&A despite thinned initial public offerings (IPOs).

According to data released by Financial Supervisory Service (FSS) on Wednesday, equity offerings surged 263.5 percent on month to 3.49 trillion won ($2.7 billion) in April. Out of the total, 3.2 trillion won worth new shares were sold by Samsung Biologics to raise funds to buy Biogen’s stake in their JV, Samsung Bioepis.

IPOs fell 34.6 percent on month to 64.1 billion won. All five IPOs were for the secondary Kosdaq market after a series of big names canceled their listings on the main Kospi bourse due to the tepid environment.

Debt issues surged 28.8 percent on month to 16.6 trillion won in April. Corporate bond issues jumped 172.2 percent to 5 trillion won. The offering was made up of mid-to-long dated papers with the amount of funds for refinancing and facilities decreasing but increasing for operation. Papers rated AA and above made up 85.8 percent of the offering, jumping 39.3 percent from the previous month.

Issues of financial notes amounted to 10.09 trillion won, up 8 percent from the previous month while asset-backed securities plunged 11.2 percent to 1.5 trillion won.

The corporate bond balance as of late April came to 630.5 trillion won, up 0.28 percent from the previous month.

The combined issues of stocks and bonds came to 20.1 trillion won, up 45.1 percent from the previous month.

Commercial paper issues reached 36.42 trillion won, up 16.3 percent and short-term debentures fell 14.7 percent to 100.88 trillion won.

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