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| Retail investors of SillaJen hold a protest in front of the Korea Exchange's office in Seoul, urging the exchange operator to resume trading of the scandal-tainted biopharmaceutical firm. Yonhap |
By Lee Min-hyung
SillaJen faces a crucial week, as the firm's six-month grace period to avert a possible delisting from the local stock market is scheduled to end on Aug. 18.
In February, the Kosdaq-listed biopharmaceutical company was given a grace period to improve its business practices from the market committee of the secondary trading board here.
SillaJen has to submit a report in 15 business days from the end of the period and show detailed evidence of any measures it has taken for business improvement with confirmation by experts.
The Korea Exchange will then hold the Kosdaq market committee meeting 20 business days after the submission of the report and decide whether to delist the company from the stock market.
In January, the Korea Exchange decided to delist SillaJen from the local stock market, citing a negative outlook regarding the firm's sustainable growth. But the company secured a chance to avoid delisting after the Kosdaq's market committee granted the grace period for the troubled company to rectify its business malpractices ― such as alleged embezzlement from within executive-level management.
The scandal is centered on the firm's top management including former CEO Moon Eun-sang who was indicted in 2020 on charges of setting up a paper company for illicit trading acts. The prosecution estimated that the top executives of SillaJen earned more than 190 billion won through illicit trades.
The upcoming decision by the exchange will determine the fate of around 160,000 retail investors of SillaJen. Minority shareholders hold a more than 90 percent stake in the firm as of the end of 2020.
The final decision on the company will be confirmed by around mid-October. If the exchange operator decides to resume trading of SillaJen, this will mark the first time since its stock trading was suspended in May 2020. But if the exchange decides again to delist the firm, the company can raise an objection and the market committee meeting will be held again.
