By Hanwha Aerospace, a major player in South Korea’s defense and aerospace sector, saw its shares drop nearly 15% on Thursday following the announcement of a rights issue. The company plans to raise capital to fund expansion and reduce debt, but investors reacted negatively to the potential dilution of shares.
The rights issue allows existing shareholders to purchase additional shares at a discounted price, but the market’s response highlighted concerns about the company’s growth prospects. “Investors are wary of the short-term impact on shareholder value,” said Park Min-ji, a financial analyst in Seoul.
Hanwha Aerospace has been a key contributor to South Korea’s defense industry, but the recent stock plunge underscores the challenges of balancing growth with shareholder interests.