Soosung Webtoon Acquires and Cancels 23rd Convertible Bonds Early with Borrowed Funds, Eliminating Potential 10% Dilution but Increasing Debt Burden
Soosung Webtoon has decided to acquire and cancel the 23rd series unregistered unsecured private convertible bonds before maturity.
The total acquisition amount including principal and interest is KRW 11,663,300,898, funded through a loan from Daelim Co., Ltd. at an annual interest rate of 4.6% for a five-year term.
The conversion price of the bonds was KRW 5,360, far above the current stock price of KRW 382, making conversion unlikely; however, the cancellation completely removes the potential dilution of approximately 10% of outstanding shares.
The reliance on borrowed funds for the acquisition increases financial leverage, which may lead to higher interest expenses in the future.
No separate shareholder return policies such as share buybacks or dividends have been mentioned.
[AI Summary]Soosung Webtoon has eliminated potential equity dilution by early redeeming and canceling convertible bonds, but the debt-funded acquisition has increased financial leverage, posing a risk to balance sheet health. While short-term dilution risk is resolved, the higher debt burden is a negative factor for investors.
KOSDAQ Filing Information
Acquisition of Convertible Bonds (Including Offshore Convertible Bonds) Before Maturity After Issuance (Series 23)