FAQ regarding Biogen’s recent letter expressing its intent to execute its call option
1. Why did Biogen send Samsung Biologics a letter expressing its intent to exercise its call option?
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On March 27, Samsung BioEpis asked Biogen about how to schedule the call option as a practical matter, as there is limited time to prepare for the call option exercise deadline occurring on June 29, 2018 at the board meeting. Since then, Biogen's decision to exercise its call option was expressed recently during its earnings report conference call on April 24, and Biogen has now sent a letter entitled 'Preparation of Option Exercise'.
2. When did Samsung Biologics receive the letter?
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Samsung Biologics received the letter yesterday (May 17, 2018)
3. Why didn't Samsung Biologics immediately make the letter public at the time of receipt?
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It took time to consult with the Korea Exchange and Biogen regarding the letter’s disclosure and announcement.
4. What are the key contents of the letter?
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Biogen expressed its intention to exercise its call option right by 24:00 June 29, and stated that both Biogen and Samsung Biologics should commence preparations to transfer funds and shares pursuant to the exercise of the call option.
5. What is the cost to exercise the call option?
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As of June 29, 2018, the amount required to acquire an additional approximately 44.6% stake in Samsung Bioepis is expected to be around 700 Billion Won.
6. How does the call option exercise affect Samsung Biologics financial statements?
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We anticipate that it will take about two to three months for the completion of formal procedures including those related to international transfer and deposit of funds and merger control approvals, after which Biogen will transfer around 700 Billion Won to Samsung Biologics.
7. What is the relationship between Biogen and Samsung Biologics after the exercise of the call option?
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After the exercise of the call option, as Samsung Biologics will control “50% + 0.5 shares” (currently 94.6%) and Biogen will control “50% - 0.5 shares” (currently 5.4%), the Board of Directors will be divided into two groups and the Representative Director will be nominated. According to the Joint Venture Agreement, actions taken by shareholder vote require a 52% majority, so Samsung Bioepis will be jointly managed by the two companies.
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1. Why did Biogen send Samsung Biologics a letter expressing its intent to exercise its call option?
On March 27, Samsung BioEpis asked Biogen about how to schedule the call option as a practical matter, as there is limited time to prepare for the call option exercise deadline occurring on June 29, 2018 at the board meeting. Since then, Biogen's decision to exercise its call option was expressed recently during its earnings report conference call on April 24, and Biogen has now sent a letter entitled 'Preparation of Option Exercise'.
2. When did Samsung Biologics receive the letter?
Samsung Biologics received the letter yesterday (May 17, 2018)
3. Why didn't Samsung Biologics immediately make the letter public at the time of receipt?
It took time to consult with the Korea Exchange and Biogen regarding the letter’s disclosure and announcement.
4. What are the key contents of the letter?
Biogen expressed its intention to exercise its call option right by 24:00 June 29, and stated that both Biogen and Samsung Biologics should commence preparations to transfer funds and shares pursuant to the exercise of the call option.
5. What is the cost to exercise the call option?
As of June 29, 2018, the amount required to acquire an additional approximately 44.6% stake in Samsung Bioepis is expected to be around 700 Billion Won.
6. How does the call option exercise affect Samsung Biologics financial statements?
We anticipate that it will take about two to three months for the completion of formal procedures including those related to international transfer and deposit of funds and merger control approvals, after which Biogen will transfer around 700 Billion Won to Samsung Biologics.
7. What is the relationship between Biogen and Samsung Biologics after the exercise of the call option?
After the exercise of the call option, as Samsung Biologics will control “50% + 0.5 shares” (currently 94.6%) and Biogen will control “50% - 0.5 shares” (currently 5.4%), the Board of Directors will be divided into two groups and the Representative Director will be nominated. According to the Joint Venture Agreement, actions taken by shareholder vote require a 52% majority, so Samsung Bioepis will be jointly managed by the two companies.
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