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WuXi AppTec prices H shares
Posted on Wednesday, 29 July 2020 10:13
WuXi AppTec is raising HKD 7.37 billion (USD 950.89 million) after pricing the sale of 68.21 million new H shares no less than six independent, professional, institutional, and other investors at HKD 108.00 apiece.
The price represents a discount of 5.2 per cent to the close of HKD 113.90 in Hong Kong on 28th July, the last unaffected trading day prior to the placing agreement.
WuXi AppTec’s offering represents a 22.2 per cent stake of the total H shares in issue, and 2.9 per cent of the overall outstanding equity, following the placement.
Morgan Stanley, Huatai Financial Holdings, Goldman Sachs and JPMorgan are acting as placing agents.
WuXi AppTec said the equity dilution will broaden its H share stockholder base and improve its access to institutional investors.
Furthermore, proceeds will provide readily available funding to “seize large transient opportunities for securing acquisition of suitable overseas target companies”.
It would focus on contract development and manufacturing organisations, clinical and pre-clinical contract research organisations, and drug discovery companies, with valuations of USD 500.00 million or more.
Such targets would also have an operating history of more than ten years and 1,000 employees.
Ideally, these businesses could potentially provide effective collaboration with WuXi AppTec’s own service platform and support for the growth of its healthcare ecosystem.
The company would be able to expand its global capacity and capabilities amid the industry trend of localisation.
It would be in a better position to respond to the recent policy trend and legislation initiatives of the US in increasing domestic pharmaceutical manufacturing activities as a result of the Covid-19 pandemic.
WuXi AppTec will also be able to capture opportunities to consolidate its existing market share in China and can use proceeds to pay down debt, make acquisitions in the US, Europe and Asia Pacific, and expand overseas.
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