Biotech group Chi-Med plans Hong Kong listing of up to $500 mln - sources
By Julia Fioretti and Julie Zhu
HONG KONG, April 15 (Reuters) - Biotech company Hutchison
China MediTech, known as Chi-Med, has filed for a Hong
Kong listing, which four sources close to the matter said could
raise up to $500 million.
Chi-Med, which is already listed on the London Stock
Exchange and the Nasdaq in New York, filed its listing
application with the Hong Kong stock exchange on Monday.
"We are delighted to announce our proposed Hong Kong listing
and global offering of shares," said Simon To, Chairman of
Chi-Med, which is 60.2 percent owned by CK Hutchison.
Chi-Med's statement did not say how much it planned to
The company did say it expected to use net proceeds from any
primary sale of shares in the offering to fund the late-stage
clinical development of its global and China pipeline and
advance its pipeline of clinical-stage drug candidates.
Chi-Med also said it wanted to list in Hong Kong to improve
liquidity for shareholders and strengthen its access to capital.
The deal, which also includes a secondary share sale by
parent CK Hutchison Holdings, could raise up to $500 million,
the people said, with one saying the size would be between $400
million and $500 million. Another source said the deal size
would likely be around $300 million.
Deal sizes can change and are often smaller than the
original target size.
CK Hutchison plans to reduce its stake to below 50 percent
and will include a secondary share sale as part of the Hong Kong
Hong Kong has sought to transform itself into a listing hub
for emerging biotech companies to compete with other financial
centres such as New York by changing its listing rules to allow
companies with no revenues in the sector to list.
While the first few listings performed poorly, the two
biotech companies that completed their initial public offerings
(IPOs) in Hong Kong this year have done well.
CanSino Biologics is up 89 percent from its IPO
price while CStone Pharmaceuticals is up 30 percent
from its offer price.
Two sources said the company was aiming for a listing by the
Chi-Med reported a loss of $74.8 million on revenues of
$214.1 million in 2018, its draft IPO prospectus showed. It loss
in 2017 was $26.7 million on revenues of $241.2 million.
Bank of America Merrill Lynch and Goldman Sachs
are joint sponsors for the Chi-Med listing.
(Reporting by Julia Fioretti. Editing by Jane Merriman)
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