PE investors back $402m Sinovac take-private
A consortium of private equity investors has agreed to privatize US-listed Chinese biopharmaceutical player Sinovac Biotech in a deal worth $401.8 million, bringing a contentious bidding process to an end.
The buyer group includes SAIF Partners, Advantech Capital, C-Bridge Capital and Vivo Capital, as well as Weidong Yin, chairman and CEO of Sinovac, according to a filing. They will pay $7.00 per share, which represents a 39% premium to the January 29 closing price. Sinovac’s stock closed up 12.5% at $6.41 following the announcement of the agreement, which still requires shareholder approval.
SAIF and Yin together hold a 29.5% stake in Sinovac, which will be rolled over into the acquisition vehicle. The other private equity investors will make equity contributions, with the balance of the deal to be financed through debt.
SAIF and Yin originally offered to pay $6.18 per share in February 2016. Within days, a competing consortium featuring China International Capital Corporation and several domestic pharmaceutical firms countered with a bid of $7.00 per share. In response, Sinovac launched a rights plan that would see additional stock issued to existing shareholders if a prospective buyer built up a stake of 15% of more.
A similar “poison pill” strategy was employed by iKang Healthcare Group in 2015, after a PE-backed privatization launched by the company’s chairman was challenged by a consortium featuring a rival Chinese healthcare group Meinian Onehealth. In that instance, the chairman’s consortium withdrew after a third buyer – Yunfeng Capital – entered the fray. However, the rights offer remained in place and iKang is still publicly traded.
Sinovac was founded as Tangshan Yian in 1993 and listed in the US through a reverse merger in 2003. Seven years later it moved to NASDAQ, raising $61.8 million. The company produces a range of vaccines used to treat infectious diseases such as hepatitis, influenza and mumps. Most of its sales come from three drugs, two of which target hepatitis and the third, influenza.
Revenue came to $67.4 million in 2015, up from $62.9 million the previous year. Sinovac has posted net losses in four out of the past five years, including 2015, when it lost $4.98 million.
More on Greater China
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.