Lunit plans to raise 200 billion won ($151 million) in shareholder rights offering. Aside from strengthening research and development, the company has announced the planned establishment of a corporate venture capital (CVC).

In a public filing Wednesday, Lunit announced its decision to conduct a capital increase by allocating new shares to existing shareholders. Lunit plans to issue 1,857,150 new shares, about 15 percent of its current 12,381,004 outstanding shares.

The capital increase will be carried out as a general public offering of beneficial shares after allotment to shareholders. The number of new shares allocated per share is 0.14999995. That is, each shareholder participating in the capital increase will have the right to acquire 0.14999995 shares for each share.

The planned issue price is 108,700 won, and the funds raised will be about 209 billion won. The issue price of the new shares will be finalized on Oct. 27, and the reference date for the allocation of new shares is Sept. 25. The subscription period is scheduled for Nov. 1-2. NH Investment & Securities is the lead underwriter.

Lunit plans to use the funds from the capital increase to upgrade products by strengthening R&D, develop next-generation new products, expand global expansion, establish a corporate venture capital (CVC), and hire new overseas employees.

More specifically, it has set aside 50.7 billion won for product enhancement and new product development, 40 billion won for new business expansion, 90.7 billion won for investment in other companies, and 20.4 billion won for hiring overseas employees.

Lunit explained that the funds will be used to develop new products for new modalities and cancer types, and the specific uses include dataset purchase, management, and clinical research.

It also will use the money to purchase and manage data from various patient groups and develop biomarkers for antibody-drug conjugate (ADC) anticancer drugs.

Besides, Lunit unveiled plans to license in new drug candidates by entering new businesses. It also expressed an intention to establish an enterprise-type venture capital firm to generate mid- to long-term revenue streams and strategic M&A.

Conscious of its shareholders, Lunit added that its largest shareholders, including Chairman Baek Seung-wook and CEO Seo Beom-seok, will participate in the capital increase with a 100-percent allocation ratio.

Lunit has also decided to conduct a one-for-one free capital increase immediately after the paid-in capital increase. New shares issued due to the capital increase will also have the right to receive new shares by participating in the rights issue.

"Lunit has attained rapid growth in sales since commercializing its medical AI products, reaffirming the company's global competitiveness," a company official said. "Now is the time to expand the market more rapidly. Through this capital increase, in which our largest shareholder and CEO will participate 100 percent, we will continue to grow as a leading global medical AI company."