Kolon Industries to Merge Subsidiary Kolon ENP—Portfolio Upgrade

(Seoul=Yonhap Infomax) Jae Heon Lee = Kolon Industries Inc. (KRX: 120110) announced on the 24th that it will merge its subsidiary Kolon ENP Co. (KRX: 138490) as part of efforts to build a high-value specialty product portfolio and enhance operational efficiency.

Established in 1996, Kolon ENP is a high-performance engineering plastics materials company, supplying value-added products such as compounds and composites to advanced industries including automotive and medical sectors. The company operates two plants in Gimcheon and exports products not only to the domestic market but also to China and Europe.

The merger will be executed through a comprehensive succession of Kolon ENP’s assets and liabilities, with existing Kolon ENP shareholders receiving new shares in Kolon Industries, the surviving entity. The allocation ratio is set at approximately 0.19 Kolon Industries shares for each Kolon ENP share, resulting in the issuance of a total of 2.43 million new shares.

Kolon Industries currently holds a 66.68% stake in Kolon ENP, making it the largest shareholder. The merger is targeted for completion by April next year.

Upon completion, Kolon Industries expects to further strengthen its materials and components portfolio and sales network. In January this year, the company merged with Glotech, establishing a comprehensive automotive materials lineup ranging from airbags and car seats to interior components. By integrating Kolon ENP’s high-value automotive materials, Kolon Industries aims to provide customized solutions that meet the diverse needs of global clients. The company also plans to enter the medical device industry.

Kolon Industries explained that the integration of purchasing, production, sales, and logistics organizations across both companies will generate cost savings by eliminating redundancies. The company anticipates that increased assets and improved cash flow will accelerate the development of new products going forward.

Heo Sung, CEO of Kolon Industries, stated, “This merger is a decision that benefits both companies in terms of shareholder value and future growth. Kolon Industries will continue to focus on transitioning its portfolio toward high-value-added products.”

jhlee2@yna.co.kr

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