Hopu founder backs China healthcare-focused SPAC

Fang is one of three owners of the sponsoring entity of HH&L Acquisition, alongside Kenneth Hitchner and Richard Li. Hitchner is a Goldman Sachs veteran who helped establish the firm’s healthcare banking group and latterly served as CEO of Asia Pacific ex-Japan. Li has until recently held a leadership position at China Great Wall Asset Management’s international business and before that worked for Goldman. Fang is also a Goldman alumnus.

Fang has no direct management role in the SPAC, serving as chairman of the advisory board with a brief to provide advice on investment sourcing, execution, and management. However, there is a formal relationship between the sponsor and Hopu, with the latter providing office space and administrative services, as well as access to its networks and relationships.

The decision to focus on healthcare was driven by structural trends within China and other Asian markets, including aging populations, policy reforms, rising purchasing power, technological innovation, and private sector expansion. Moreover, COVID-19 is expected to boost healthcare awareness on an individual and on a policy basis, which will lead to further spending and investment, the prospectus states.

Other management team members include Huanan Yang, an executive director at Hopu, Christina Zhong, previously of Morgan Stanley and Goldman Sachs, Qingjun Jin, a senior partner at King & Wood Mallesons, and Jingwu Zhang Zang, founder of I-Mab Biopharma.

HH&L Acquisition is offering 30 million units for $10 apiece, with an overallotment option of 4.5 million units. Each unit comprises one class A ordinary share and one-half of one redeemable warrant. Each whole warrant can be converted into a class A ordinary share at a price of $11.50 per share.

Once a target is identified, a majority of investors must vote in favor of the transaction. On completion, they can exercise their warrants and purchase shares or redeem some or all their shares for cash. If there is no deal within 24 months of the offering, investors get their money back.

The SPAC sponsor agreed to purchase $8 million in warrants, subject to the standard conversion conditions. In addition, the sponsor and management subscribed to class B shares for a nominal sum that will convert into a 20% stake in the entity on completion of the offering.

A host of Asia-related SPACs have been launched by PE firms or by individuals with experience in the industry. Among China managers alone, Liang Meng, founding managing partner of Ascendent Capital Partners, sponsored a SPAC that raised $300 million, while Fred Hu, founder of Primavera Capital Group, is targeting the same amount. While Hu’s SPAC is described as an affiliate of Primavera, there is no formal connection between Ascendent and Meng’s structure.

Hopu was established in 2008 and now has more than $10 billion in assets under management across US dollar-denominated and renminbi funds.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Greater China
• Fundraising
• IPO
• Healthcare
• China
• Asia
• SPAC
• Hopu Investment Management