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Huons Global moves to calm investors over controversial merger
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By
Lee Kyung-min
Published
May 22, 2026 1:55 pm
KST
Updated
May 22, 2026 2:09 pm
KST
Huons Global's corporate logo / Courtesy of Huons Global
Huons Global moved Friday to contain growing shareholder concerns over a planned merger between two of its affiliates, saying the deal is critical to securing the prescription drug and health supplement conglomerate’s long-term growth engine and stabilizing funding for its unprofitable biotech unit.
The holding company said it will hold a shareholder meeting to explain the rationale behind the merger of Huons and Huonslab, while also gathering investor feedback on the transaction and its potential impact on minority shareholders.
The announcement comes days after Huons, a subsidiary of Huons Global, approved a merger agreement to absorb Huonslab during a board meeting held Sunday.
Huonslab, a biotechnology affiliate focused on innovative biopharmaceutical development, currently operates without a revenue base and has been posting widening losses as it accelerates research and development efforts.
The company recorded an operating loss of 10.2 billion won ($6.7 million) last year, with the deficit widening 20.8 percent from a year earlier, according to Huons Global.
Huons Global said the merger was effectively unavoidable because Huonslab remains in a state of capital impairment and faces limits in raising additional funds independently.
The holding company also said Huons, rather than Huons Global itself, was the more appropriate merger partner because it possesses manufacturing, licensing and development capabilities necessary to commercialize Huonslab’s pipeline.
Huons Global said its own structure as a pure holding company leaves it with limited cash reserves and no production or regulatory personnel capable of supporting drug development operations.
The company added that pharmaceutical investment in research and development aligns with broader government policy encouraging innovation in the biotech sector.
Separately, Huons Global said its board plans to establish a special committee and seek outside expert reviews to independently assess the fairness of the merger ratio and valuation process.
A company official said Friday that the board recognizes its fiduciary duty to all shareholders, including minority investors, and plans to disclose detailed findings and supporting data during the upcoming shareholder meeting.
This article was published with the assistance of generative AI and edited by The Korea Times.
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