No. 1 KOSDAQ firm announces 100% stake sales

Chairman Seo Jeong-jin of Celltrion, Korea`s major biotechnology firm with No. 1 stock value in the tech-heavy KOSDAQ, said he will sell all his stake in the company to a multinational pharmaceutical firm because he is exhausted in fighting with short stock sellers.

At an emergency news conference Tuesday morning at 63 Building in northern Seoul, Seo said, "I will sell all stakes of Celltrion, Celltrion Pharmaceuticals and Celltrion Healthcare as soon as the European Medicines Agency approves the sale of Remsima, a generic arthritis drug we developed."

Seo owns 30.1 percent in Celltrion shares through Celltrion Holdings in which he has a 97.3 percent stake. He holds 50.3 percent in Celltrion Healthcare and 32.4 percent in Celltrion Pharm. The chairman said his stake appraised value amounts to 1.7 trillion won.

"I decided the sale to prevent damages to employees, minority shareholders and partners from abnormal short stock selling forces who are spreading malicious rumors to lower stock prices for the sake of profit taking," Seo said.

According to Seo, short Celltrion stock selling occurred for 412 days among 432 trading days in the past two years. He countered the selling spree by illegal stock price manipulators while injecting 800 billion won (717 U.S. million dollars) worth capital, but ultimately gave up.

He claimed, "I asked a number of times the Financial Supervisory Service, the Korea Exchange and the Financial Services Commission to improve such negative short selling practice, but saw no improvements."

Seo also criticized Korea`s corporate environment saying creative companies are not generated with just slogans of "creativity." He said, "I started the company with two employees in 2000 and have grown it into a leading firm with 1,500 talented workers. I had a goal of establishing a multinational pharmaceutical firm. However, there was no capital market to provide funds to creative companies, and no one understood our business model."

On his future plans, Seo said, "I want to help Korea`s small start-up investment companies to nurture the next Celltrions."

Celltrion`s stock prices surged by 5.06 percent to 49,800 won (44.6 dollars) Tuesday on Seo`s announcement.

jks@donga.com