Geo-Young, South Korea's largest pharmaceutical distributor, has categorically denied recent speculations about a possible acquisition by Zuellig Pharma, as reported by multiple news sources.

Geo-Young refuted rumors suggesting that Zuellig Pharma may be seeking to purchase the company from Blackstone.

The initial report on these rumors was published by The Korean Economic Daily, a local economic newspaper, last Thursday. The article stated that Zuellig had begun the process of appointing an advisory firm for the acquisition of a stake in Geo-Young, citing an unnamed investment banking official.

Zuellig, headquartered in Singapore, stands as the largest pharmaceutical distributor in Asia. It operates in 13 Asian countries, including South Korea, Vietnam, Taiwan, the Philippines, and Singapore, and maintains partnerships with the top 20 global pharmaceutical firms, ensuring the supply of medications across these nations.

Blackstone, a global investment firm, holds the majority stake in Geo-Young through the latter's holding company, Cho Sunhae GY Holdings Co. In July, Blackstone sent out a request for proposal (RFP) to major domestic and foreign securities firms to oversee the sale of Geo-Young, with Morgan Stanley being selected as the lead for the sale.

Blackstone holds the majority stake in Geo-Young Corp., through the latter's holding company Cho Sunhae GY Holdings Co.

Of the 99.17 percent stake in Geo-Young held by Cho Sunhae GY Holdings Co., Blackstone owns 71 percent, while the remaining shares are held by Geo-Young's co-founders: Chairman Choi Sun-hae, who owns 22 percent, and Chairman Emeritus Lee Hee-koo, who holds 7 percent.

Blackstone had invested over 1 trillion won ($736.8 million) in acquiring Geo-Young in 2019 and is now considering selling its entire stake in Cho Sunhae GY Holdings Co. for approximately 2 trillion won, according to local news reports.

Industry experts had already cast doubt on the rumors of Zuellig acquiring Geo-Young even before Geo-Young refuted them. "

It is well known among industry insiders that Geo-Young had previously contemplated acquiring Zuellig Pharma Korea, making a reverse acquisition seem a challenging proposition," an industry source told Korea Biomedical Review, asking to remain anonymous due to the issue's sensitivity.

Zuellig Pharma's business in the country has reported consecutive operational and net losses for the past five years, leading to a reduction in the workforce since 2021.