SEOUL, KOREA - China's Huacheng Travel Agency is negotiating to acquire Korea's Schnell Biopharmaceuticals Inc. The travel agency famous for attracting Chinese tourists to Jeju Island is gaining keen attention how it will pull off the acquisition and what synergies it is aiming for from the deal.

 

Schnell Biopharmaceuticals said on September 11 in a regulatory filing, "We are currently in talks with Huacheng Group of China for possible stake sale." Established in the 1960s, Schnell is a specialized drug maker and has made the initial public offering in 1984. Its sales revenue last year was 29.5 billion won, down 17.5 percent from the previous year. Last year's operating loss was 2.1 billion won. The company's sales revenue and operating profit have been in decline for three consecutive years.

 

The company's largest shareholder is Aprogen, with a 10.71-percent stake. The stakeholding by specially related persons including its president Kim Jae-seop is 16.08 percent. Analysts estimated that its largest shareholders leaned toward selling the controlling stake as the company was unable to turn to the black for the ten consecutive years.