Boryung Biopharma up for sale for money to ensure succession

Boryung Biopharma factory [Source : Boryung Biopharma]

South Korea’s Boryung Pharmaceutical Group has put its unlisted vaccine manufacturing business up for sale, a seemingly inevitable move to raise funds to ensure management succession to the third generation of its owner family amid a slowdown in the initial public offering (IPO) market.

According to sources in the investment banking industry on Thursday, the pharma group recently embarked on a process to sell Boryung Biopharma after picking Samil PricewaterhouseCoopers as the deal’s lead financial manager. It is said to have started contacting potential bidders individually.

The asset put up for sale is a 100 percent stake in Boryung Biopharma owned by Boryung Partners, owner family members and investors, which is estimated at up to 500 billion won ($390 million).

The sale comes after Boryung Biopharma failed to go public on the country’s junior Kosdaq market due to tepid IPO demand. The company was valued at 400 billion won during the most recent funding round attended by Shinhan Investment & Securities and Mirae Asset Securities, among others. Based on this price, the selling party hopes to get at least 600 billion won from the sale, according to sources.

Established in 1991, Boryung Biopharma developed Korea’s first oral typhoid vaccine and currently produces a variety of vaccine products. The company’s revenue and operating profit last year were 139.1 billion and 19.8 billion, up by 29 percent and 75 percent, respectively, compared to the previous year on a consolidated basis.

Boryung Partners controls nearly 70 percent of Boryung Biopharma, and Boryung Holdings chief executive Kim Jeong-gyun, which is the third generation of Boryung Pharmaceutical Group’s owner family, is the de facto owner of Boryung Partners. Through the latest sale, Kim is suspected to be seeking to raise ammunition to cement his position as the largest shareholder of Boryung Holdings, the holding company of Boryung Pharmaceutical Group.