English translation of the original Korean report. Images and source documents may contain Korean text.

The KOSDAQ-listed company Yookil C&E, which previously supplied smartphone tempered glass to LG Electronics, sold its profitable precision chemical subsidiary for 14.5 billion won and then decided to purchase 2.5 billion won worth of Songdo real estate. It is currently engaged in the business of educational equipment such as electronic whiteboards.

The investment decision, made 20 days after the appointment of Kim Seung-jun and Lee Jeong-ho as individual representatives, involves investing 10.5 billion won more in real estate than the proceeds from the subsidiary’s sale.

According to the Financial Supervisory Service Electronic Disclosure System on June 6, Yookil C&E decided to purchase land and buildings in Songdo, Incheon Yeonsu-gu from Onhill for 2.5 billion won on May 21. The land area is 4,818.3 square meters and the building area is 6,072.78 square meters. The transaction amount accounts for 44.64% of the company’s total consolidated assets as of the end of last year, and it is 106.4% of the company’s consolidated equity of approximately 23.5 billion won as of June 30 this year.

Previously, the company sold all shares in its precision chemical subsidiary, C&N, for the purpose of business restructuring and new business investment, and completed the transaction on July 23. The precision chemical division, which C&N handled, recorded an operating profit of 1.673 billion won in the first half of this year. During the same period, the edutech division recorded an operating profit of 883.46 million won, while the other business division, which corresponds to the parent company, recorded an operating loss of 610.68 million won, meaning the precision chemical division offset the losses of other businesses.

■ The new representatives’ affiliated company, same address as the seller Onhill

This investment decision was made shortly after the management change. On May 1, the previous representatives, Gu Ja-ok and Kim Dong-hoon, resigned, and Kim Seung-jun and Lee Jeong-ho were newly appointed as individual representatives. However, the largest shareholder has not changed. According to the self-share purchase result report on May 2, the former representative Gu Ja-ok is listed as the largest shareholder, holding a total of 5,521,401 shares, including common and preferred shares. This accounts for 31.26% of the total issued shares.

The headquarters address of the seller Onhill is the same as the headquarters address of the company managed or invested in by Yookil C&E’s new representatives. The company is Bio Infrastructure Life Science, where Kim Seung-jun, Yookil C&E’s representative, also serves as a director, and Lee Jeong-ho, the representative, was the largest shareholder with a 21.39% stake as of the end of last year.

Bio Infrastructure Life Science announced in July that it would move its headquarters to Incheon Yeonsu-gu, with the move date being August 5. The road name address listed in the disclosure matches the headquarters address of the real estate seller Onhill.

The company stated that the purpose of the real estate purchase was for new business initiatives and investments, with expected effects of enhancing long-term asset value. Hyundai Accounting Firm determined that the purchase price of 25 billion won was appropriate, based on the average valuation of about 25 billion 52.53 million won from the two appraisal firms. The purchase price is 0.21% lower than the average valuation. The board of directors that decided on the purchase included one independent director and an auditor, but specific utilization projects and expected revenues were not mentioned in the relevant acquisition announcement.

This month, the payment schedule was advanced. In a correction announcement on the 2nd, the company changed the remaining 2 billion won to be paid in 30 days to 500 million won as an interim payment on the 2nd, reducing the remaining balance to 1.5 billion won. The company was removed from the restricted list on the 5th, and it announced that the purchase funds would be raised through existing cash and bank loans. The deadline for the remaining balance is the 30th, with 24 days remaining as of the 6th.