Shandong Lukang Pharmaceutical to raise 1.2 bn yuan for strategic expansion

Shandong Lukang Pharmaceutical announced a proposed non-public issuance of A-shares in 2024 to raise up to 1.2 billion yuan. The funds will be allocated across four key initiatives: 400 million yuan for a high-end formulation intelligent manufacturing workshop, 400 million yuan for a bio-pesticide base, 200 million yuan for new drug research and development, and 200 million yuan for working capital.

The issuance is pending approval from the China Securities Regulatory Commission (CSRC) and the Shanghai Stock Exchange. Huaxin Group, the controlling shareholder, will participate by subscribing proportionally to its existing stake, committing to acquire shares not exceeding 64,201,417 based on the company's total share capital as of September 30, 2024. The pricing will be no less than 80% of the average stock trading price over the twenty trading days prior to the issuance start date.

Upon completion, the issuance is projected to increase Shandong Lukang Pharmaceutical's total share capital and net assets. The company anticipates enhanced profitability and reduced financial leverage, supporting its long-term strategic growth in the pharmaceutical and bio-pesticide sectors.