Hanon Systems, a global provider of automotive thermal energy management solutions for electrified mobility, announced that its board of directors has conditionally approved to expand the third-party allotment capital increase previously disclosed on May 3. Under the revised terms, Hanon Systems will issue approximately 145 million shares at a price of KRW 4,139 per share, raising a total of KRW 600 billion, fully funded by Hankook Tire & Technology. The initial capital increase of KRW 365.1 billion has expanded to a total of KRW 600 billion.
The capital increase is purposed to proactively secure operational funds for cost structure improvements while maintaining the company’s competitiveness in the evolving automotive industry. A portion of the funds will be used for debt repayment, strengthening Hanon Systems’ financial stability.
The amended terms of the capital increase are subject to consent of Hahn & Company Auto Holdings’ acquisition financing lenders. Following this consent, Hahn & Company Auto Holdings and Hankook Tire & Technology will enter into a stock purchase agreement, with the capital increase funds to be deposited once the remaining international merger filings are completed. If the amended terms proceed as planned, the capital increase is expected to be completed by year-end.
Since the onset of the pandemic, the global automotive parts industry has been challenged by supply chain disruptions, inflation, and geopolitical conflicts. Additionally, with global automakers revising their electrification strategies, autoparts suppliers are also required to adjust their investment and production plans accordingly.
Despite these challenges, Hanon Systems has achieved growth through significant new business awards in the eco-friendly vehicle platforms of major automakers, supported by its technological leadership in thermal management solutions. The company plans to complete business restructuring through this capital infusion to adapt proactively to the evolving industry environment and to position itself for future growth.
“As major automakers adjust their electrification strategies, it is crucial to build a flexible business structure that can respond to industry changes,” said Nurdal Kücükkaya and Subu Nagasubramony, co-CEOs of Hanon Systems. “Hanon Systems is uniquely positioned with the technology and expertise to serve electric vehicles, hybrids, and internal combustion engines. By securing strong financial stability, we can further solidify our market leadership.”