Samsung BioLogics Co., currently building the world’ largest biopharmaceutical manufacturing plant, is gearing up to go public on the main Korean bourse within the year to raise funds for future expansion.

According to sources at Samsung and investment bank, Samsung Group, which has been investing heavily into biologics to foster the area as its new core business, opted to list the affiliate on the main Kospi bourse instead of the technology-laden Kosdaq or overseas markets. The Kospi recently opened doors to loss-making yet promising companies. Samsung will announce the outline of listing plot later this week.

Samsung C&T Corp., the de facto holding company for Korea’s largest conglomerate, holds 50 percent and Samsung Electronics Co. 46.8 percent in Samsung BioLogics, a contract manufacturing organization established in 2011. It is currently building a third pharmaceutical plant in its manufacturing base in Songdo, Incheon, at a capital of 850 billion won ($722 million). Once completed in 2017, its annual output capacity will be doubled from current levels to 360,000 liters, exceeding current world’s No. 1 Lonza of Switzerland with 260,000 liters and Boehringer Ingelheim with 240,000 liters.

The company posted an operating loss of 119.5 billion won in 2014 and 203.6 billion won in 2015 due to the heavy upfront investment. It is also expected to record a loss this year due to ongoing construction of the third plant. Sales stopped at 91.2 billion won last year, but are expected to reach 950 billion won by 2020.

The company is expected to join the top 30 biggest group on the Kospi with market capitalization estimated at around 10 trillion won. It value was vetted at 6.85 trillion won during asset appraisal of Samsung C&T before its merger with Cheil Industries last year.

To ensure scale of economies, the company needs to continue beefing up production capacity. It received funding from Samsung Group until the third plant through rights offerings. As a public trading company, the manufacturer hopes to secure funds to add further facilities. Its German rival Boehringer Ingelheim announced plan to build 150,000-liter plant soon after Samsung embarked on expansion late last year.

By Lee Seung-hoon, Lee Dong-in

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