Samsung BioLogics down sharply over accounting rule violation

By Lim Chang-won Posted : May 2, 2018, 12:47 Updated : April 3, 2019, 16:57

[Courtesy of Samsung BioLogics]


SEOUL -- Shares of Samsung BioLogics, a Samsung Group bio arm, fell sharply Wednesday after South Korea's financial watchdog accused the company of violating accounting rules.

Samsung BioLogics lost 15.47 percent to trade at 412,500 won (382 US dollars) as of 12:40 pm (0340 GMT).

In its provisional decision, the Financial Supervisory Service said Samsung BioLogics breached accounting rules when it was listed in November 2016. At that time, the company reported a net profit of 1.9 trillion won (1.76 billion US dollars) in 2015 after staying in the red for four years.

In 2015, Samsung BioLogics adopted a mark-to-market accounting scheme for Samsung Bioepis, a joint venture with U.S.-based pharmaceutical company Biogen. Instead of an accounting method based on face values, mark-to-market values securities or financial instruments that a company holds at the current market prices.

Through its public offering in 2016, Samsung BioLogics raised some 2.25 trillion won, drawing widespread market attention because it's part of efforts by Samsung Electronics vice chairman Jay Y. Lee to realign the business portfolio of South Korea's largest family-run conglomerate.

Lee has promised to nurture the biopharmaceutical business as the main driver of the group's growth engine. Samsung C&T holds a 43 percent stake in Samsung BioLogics.
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