MGEN Solutions Reduces 24th CB Issuance to KRW 3.1B, Conversion Price Lowered to 1,630 Won, Dilution Ratio Drops to 6.90%
Disclosure Overview: MGEN Solutions amended its 24th private convertible bond issuance plan announced in November 2025, reducing the total issuance from KRW 4.5B to KRW 3.1B and lowering the conversion price from KRW 1,656 to KRW 1,630.
Key Changes: Issuance amount decreased (4.5B→3.1B), conversion price reduced (1,656→1,630), shares upon conversion decreased from 2,717,391 to 1,901,840 (dilution ratio 9.57%→6.90%), and the investor changed from Queen Bee Mezzanine 1 Fund & BS Partners to JC Investment Association.
Use of Funds: Full KRW 3.1B allocated for operating funds (raw material purchases and new product development).
Conversion Price Assessment: The conversion price of KRW 1,630 is set at 100% of the reference price (based on weighted average price before subscription date) and is about 21.3% above the current market price of KRW 1,344, reducing immediate conversion incentive. However, the price can be adjusted downward to a minimum of KRW 1,141 (70% of initial).
Outstanding CBs: Existing CBs (22nd, 23rd, 25th series) total KRW 13.5B (6,556,061 shares) plus new KRW 3.1B (1,901,840 shares) results in total potential dilution of 8,457,901 shares, representing 24.78% of current shares, a significant overhang.
Put and Call Options: Bondholders can request early redemption quarterly after one year (premium from 103% to 108.7% of principal). The company can call up to 50% of principal (with 2% acquisition cost).
[AI Summary]Although MGEN Solutions reduced the 24th CB size from KRW 4.5B to KRW 3.1B, lowering the dilution ratio from 9.57% to 6.90%, the combined potential dilution from existing CBs (KRW 13.5B) reaches 24.78% of outstanding shares, posing a medium- to long-term overhang risk. While the KRW 3.1B raised for operating expenses addresses near-term needs, the low conversion price floor and massive overhang are likely to cap stock upside.
KOSDAQ Filing Information
Filing: [Correction of Description] Report on Major Matters (Decision on Issuance of Convertible Bonds)