Management moves to take Nasdaq-listed Sinovac Biotech private in growing trend

Fresh off a GMP certificate for its EV71 vaccine from the China FDA Beijing-based Sinovac Biotech ($SVA) management wants to take the firm private, giving up a U.S. listing in a financial tack followed by other firms that points to an eventual re-listing in Hong Kong.

Sinovac offered a 23% premium at $6.18 a share to its Friday close price last week, according to a press release, valuing the transaction at $345 million. The management-led offer also highlights something of a divergence in strategies among China-focused firms tapping public markets and private equity or venture cash.

In the case of Sinovac, the offer is led by Weidong Yin, chairman, president and chief executive officer, and SAIF Partners to buy all outstanding common shares not held by them. The company has appointed a special board committee to review the offer made up of three independent directors. It was unclear from the release how much of the company the buyout group currently holds.

This standard operating procedure for taking a China-focused, U.S.-listed, firm private comes as Beijing-based biotech BeiGene is headed for a Nasdaq listing expected early this year that values the firm at around $756 million and sees a mid-range figure of nearly $127 million raised from an initial public offering (IPO). At the same time, Hong Kong-based Hutchison China MediTech, or Chi-Med, plans a Nasdaq IPO.

On the other hand Shanghai-based WuXi PharmaTech ($WX) left the New York Stock Exchange in a management-led buyout completed in December and Shenzhen-based Mindray ($MR) plans to do a similar deal and leave the Nasdaq with a decision expected at a Feb. 26 shareholder meeting.

But in the past year, companies such as 3SBio and Simcere that were formerly listed in the U.S. and taken private by management came roaring back to the public markets via the Hong Kong Stock Exchange (HKEx). In January, China's Simcere Pharmaceutical Group said it plans to raise as much as $1 billion on the HKEx in a return to public capital markets since delisting from the New York Stock Exchange in 2013.

In the past month, Shanghai-based Qiming Venture Partners said it closed its fifth dollar fund by pulling in nearly $650 million from investors, putting it on track to control $2.5 billion under management in the healthcare space when combined with its three yuan-denominated funds.

In other recent deals in January, Adagene secured $28 million in Series B financing led by GP Healthcare Capital. As well, WuXi Healthcare Ventures joined investments in two U.S.-based biotechs, one in San Francisco and the other in Cambridge, focused on gene work and that combined raised $101 million as part of the funds dedicated to "find in U.S. build in China" plans.

here's the release

Read more on