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Samsung Biologics upbeat after scion’s arrest warrant deniedBy Lim Jeong-yeo
Published : June 9, 2020 - 17:19
Samsung Biologics shares were upbeat Tuesday, following the court’s rejection of an arrest warrant for Samsung Electronics Vice Chairman Lee Jae-yong.
In early morning trading, shares rose nearly 3 percent than the previous day, although the price eased down to 1.8 percent range at close.
The chaebol scion is being probed by the prosecution for alleged accounting fraud intended to buoy Samsung Biologics’ performance, which the prosecutors suspect was directed to leverage Lee’s succession from his bedridden father Chairman Lee Kun-hee.
If Lee is found guilty of fiscal misconduct, it will automatically impair the business integrity of Samsung Biologics, which may suffer negative impacts in business with its mostly global clientele.
Samsung asserts that the matter is only a misunderstanding stemming from different accounting methods. The court’s rejection of an arrest warrant for Lee is further evidence that the prosecution lacks grounds to substantiate their allegations, the company said.
Samsung Biologics’ three biologics manufacturing plants in Songdo, Incheon, boast the largest output capacity in its field. Its production facility draws resources from vouched European suppliers.
The company filed a shareholders’ notice Monday that it has signed two new memoranda of understanding with unspecified biopharmas in Switzerland.
The deals together amount to 41.27 percent of Samsung Biologics’ 2019 revenue of 701.6 billion won.
One of the deals is a $202 million extension of an existing deal which had been worth $378.7 million and signed before Samsung Biologics became a listed company.
The other deal, a completely new one, also has potential to further grow to $365 million, Samsung Biologics said.
Due to contractual bindings, Samsung Biologics is barred from disclosing the names of the partners until the end of 2023.
The biologics materials for the newly forged deal will be manufactured at its plant No. 3.
Samsung Biologics CEO Kim Tae-han had said in a shareholders meeting in March that he anticipates plant No. 3 to hit maximum capacity in 2022 and that the company would prepare to build a fourth plant. Currently, has enough land to build a fourth plant on its current site, next to its existing three plants in Songdo. The company is mulling a second site within the city.
By Lim Jeong-yeo (firstname.lastname@example.org)
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