Lee Woo-hyun, chairman of OCI Holdings, speaks during a press conference on May 14 (Courtesy of OCI)
OCI Holdings Co., South Korean’s largest polysilicon maker, is looking abroad to acquire a biopharmaceutical company in the US in a consortium, or investing in a Southeast Asian company, after the collapse of its merger with Hanmi Science Co. in March, its chairman said on Tuesday.
It is zooming in on companies with sound financial conditions in line with its goal of maintaining an average return on equity of 20% or more.
“We’ve reviewed a few pharmaceutical companies in the US, chasing a deal in the trillion won range at the minimum,” OCI Chairman Lee Woo-hyun said at a press conference held to commemorate the first anniversary of OCI Holdings.
“We plan to form a consortium, where OCI Holdings participate as a strategic investor.”
The planned merger with Hanmi Science, the holding company of Hanmi Pharmaceutical Group, faltered in March due to a family feud at Hanmi, which shows no signs of ending.
“A lesson learned from the failure of the Hanmi Science deal,” Lee told reporters.
When announcing the deal with Hanmi in January, OCI had expected to turn into a global pharmaceutical and biotech behemoth from a petrochemical company, following in the path of Germany’s Bayer.
Hanmi, with more than 30 new drugs in the pipeline, was attractive for OCI seeking to go beyond a general drug maker.
In 2022, OCI purchased Bukwang Pharm Co. Lee has been leading the mid-size Korean pharmaceutical company as CEO since November last year.
OCI is also looking for an investment target among biopharmaceutical companies in Southeast Asian with about $500 million in market capitalization. It may buy its existing or new shares.
“But we will invest in one company either in the US or in Southeast Asia in consideration of our cash flows,” Lee noted.
“When investing in a new business, it should create more than 20% ROE and operating profit margin.”
Polysilicon
It will also beef up the polysilicon production for solar panels and polycrystalline silicon used for semiconductors.
Last month, the company announced a plan to invest up to 2 trillion won ($1.5 billion) in Malaysia to increase the manufacturing capacity of the polysilicon for solar panels.
By Hyeon-Woo Oh
ohw@hankyung.com
Yeonhee Kim edited this article
