Shanghai Fosun Pharmaceutical Group Co (上海復星醫藥集團) scaled back its proposed purchase of control in Indian drugmaker Gland Pharma Ltd to a level that would allow it to avoid a government review of the biggest Chinese acquisition in India.
Fosun Pharma, backed by Chinese billionaire Guo Guangchang (郭廣昌), will now buy a 74 percent stake for US$1.1 billion, a statement issued on Sunday said.
It had originally sought to buy an 86 percent stake in the closely-held Indian drugmaker from an investor group including KKR & Co.
However, a stake that size must be signed off by the Indian Cabinet Committee on Economic Affairs, which was poised to reject the move, Bloomberg reported on Aug. 1, citing people familiar.
The reduced stake would avoid a government review, Fosun said, and the deal is set to be completed by Oct. 3 as all the main conditions have been met.
The deal gives the Chinese firm access to Gland’s stable of generic injectable medicines and control of facilities to export to the US and other developed markets.
The original acquisition offer valued Gland, including debt, at about US$1.35 billion, 16 times its earnings for the last financial year, Fosun Pharma said in a statement in August last year to the Hong Kong Stock Exchange.
Gland had revenue of 1.2 billion yuan (US$183 million) and net profit of 272 million yuan in 2015, the statement said.
Fosun Pharma shares yesterday jumped as much as 4.3 percent in Shanghai. Shares of Fosun International Ltd (復星國際), Fosun Pharma’s largest shareholder, jumped as much as 9.7 percent to HK$16.46 in Hong Kong, the highest since August 2015.
The deal faced Indian regulator scrutiny as tensions between Indian and China have escalated amid a renewed spat over territory in a remote area of the Himalayas, one of the most serious flareups since a border war in 1962.
China and India ended the months-long military face-off late last month before leaders of both countries attended a summit of BRICS nations in China.
Last year, new Indian rules were passed to allow stake purchases of up to 74 percent in existing pharmaceutical companies to go through an automatic route that does not require government approval.
Founded in 1978, Hyderabad-based Gland specializes injectable drugs such as antibiotics, oncology and cardiology treatments. Its manufacturing facilities have been accepted by several regulatory agencies, including the US Food and Drug Administration, giving it access to the world’s biggest pharmaceutical market.
Chinese drugmakers have grown more ambitious in seeking deals that give them access to the US, the world’s biggest pharmaceutical market.
Valeant Pharmaceuticals International Inc this year sold its Dendreon Pharmaceuticals unit to Chinese conglomerate Sanpower Group Co (三胞集團) for US$820 million. Chinese contraceptives maker Humanwell Healthcare Group Co (人福醫藥) is part of a consortium that agreed in June to buy US-based RiteDose for about US$605 million.
Fosun Pharma has been increasingly ambitious in buying assets overseas in a push to acquire innovative pipelines and seek revenue growth as China’s pharmaceutical market slows under heavy government pressure to cut costs.
China’s banking regulator has stepped up its scrutiny on Fosun and China’s other prolific dealmaking conglomerates, people familiar with the matter said in June.
Last month, China also enacted rules to restrict overseas investments.
Napoleon Osorio is proud of being the first taxi driver to have accepted payment in bitcoin in the first country in the world to make the cryptocurrency legal tender: El Salvador. He credits Salvadoran President Nayib Bukele’s decision to bank on bitcoin three years ago with changing his life. “Before I was unemployed... And now I have my own business,” said the 39-year-old businessman, who uses an app to charge for rides in bitcoin and now runs his own car rental company. Three years ago the leader of the Central American nation took a huge gamble when he put bitcoin
Demand for artificial intelligence (AI) chips should spur growth for the semiconductor industry over the next few years, the CEO of a major supplier to Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) said, dismissing concerns that investors had misjudged the pace and extent of spending on AI. While the global chip market has grown about 8 percent annually over the past 20 years, AI semiconductors should grow at a much higher rate going forward, Scientech Corp (辛耘) chief executive officer Hsu Ming-chi (許明琪) told Bloomberg Television. “This booming of the AI industry has just begun,” Hsu said. “For the most prominent
Former Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman Mark Liu (劉德音) yesterday warned against the tendency to label stakeholders as either “pro-China” or “pro-US,” calling such rigid thinking a “trap” that could impede policy discussions. Liu, an adviser to the Cabinet’s Economic Development Committee, made the comments in his keynote speech at the committee’s first advisers’ meeting. Speaking in front of Premier Cho Jung-tai (卓榮泰), National Development Council (NDC) Minister Paul Liu (劉鏡清) and other officials, Liu urged the public to be wary of falling into the “trap” of categorizing people involved in discussions into either the “pro-China” or “pro-US” camp. Liu,
PARTNERSHIPS: TSMC said it has been working with multiple memorychip makers for more than two years to provide a full spectrum of solutions to address AI demand Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it has been collaborating with multiple memorychip makers in high-bandwidth memory (HBM) used in artificial intelligence (AI) applications for more than two years, refuting South Korean media report's about an unprecedented partnership with Samsung Electronics Co. As Samsung is competing with TSMC for a bigger foundry business, any cooperation between the two technology heavyweights would catch the eyes of investors and experts in the semiconductor industry. “We have been working with memory partners, including Micron, Samsung Memory and SK Hynix, on HBM solutions for more than two years, aiming to advance 3D integrated circuit
RSS