[Alpha Biz= Paul Lee] Shares of LS Marine Solutions, a subsea cable construction company, tumbled nearly 8% following the announcement of a major rights offering plan.
On May 27, LS Marine Solutions closed at 17,880 KRW on the KOSDAQ, down 7.93% from the previous trading day. Shares of related LS Group affiliates also fell—LS Eco Energy dropped 4.86%, LS declined 3.34%, and LS Networks lost 2.39%.
The sell-off came after LS Marine Solutions announced, after market close on May 26, that it would raise 278.3 billion KRW through a rights offering involving shareholder allocation followed by a public offering of any unsubscribed shares. The planned capital raise amounts to 47.6% of the company’s market capitalization of 584.1 billion KRW, sparking investor concerns over shareholder dilution.
Retail investors and institutions offloaded approximately 700 million KRW and 500 million KRW worth of shares, respectively, while foreign investors recorded a net purchase of about 600 million KRW.
LS Marine Solutions stated that all proceeds from the offering would be used to finance the construction of new cable-laying vessels (CLVs) to enhance its long-term competitiveness. The vessels, which are essential for building long-distance, self-sustaining power transmission networks, are part of its growth strategy from 2024 through 2028.
SK Securities noted that the large-scale capital raise is expected to support the growth potential of the company’s subsea cable business. After recording operating losses for three consecutive years through 2022, LS Marine Solutions has recently returned to profitability thanks to a surge in subsea cable installation orders.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
