Written by |彡氜.
On February 21, China Traditional Chinese Medicine announced that Sinopharm intends to sell at 4HK$6** privatization of China Traditional Chinese Medicine Holdings.
According to the announcement, on February 9, Sinopharm Gongyu *** hereinafter referred to as Sinopharm Gongyu) asked its board of directors to submit a privatization proposal to the shareholders of the plan, and if approved, China TCM would lose its listing status on the Hong Kong Stock Exchange.
The Board of Directors of Sinopharm has reviewed the proposal and agreed to present it to the scheme shareholders. According to the plan, Sinopharm will receive a price of 4HK$6 cash privatization** compared to the closing price per share on the last trading day3HK$43 premium of about 3411%。
Sinopharm Gongyu is an exempted company incorporated under the laws of the Cayman Islands for the purpose of implementing the privatisation proposal. As at the date of the announcement, the Company had 10,000 issued ordinary shares, of which the controlling shareholder, the nominee of Investor A, Investor B, Investor C, Investor D and Investor E each held approximately issued share capital. 32% and 298% of the shares.
That's a lot of things. For Chinese traditional medicine, privatization is conducive to streamlining corporate governance, corporate and shareholding structure, and improving management efficiency. And for the parties involved, it is an opportunity to establish strategic partnerships. Following the successful implementation of the privatization, Sinopharm Gongyu plans to review the company's business operations and assess the financing capacity and current market conditions of China TCM, and may explore business opportunities to develop the existing business of China TCM.
In fact, according to **, since 2021, there have been many rumors in the market that Sinopharm will privatize Chinese traditional medicine.
On January 27, 2021, news broke that the consortium led by Sinopharm planned to sell at least 5HK$10 of the ** privatization of China TCM, which is 3 compared to the average share price of China TCM over the past monthHK$83 represents a premium of about 33%, and the valuation of Chinese medicine in China has reached at least US$3.3 billion.
This is the first time it has been rumored.
More than a year later, on December 7, 2022, the market once again reported that Sinopharm was considering trying to privatize its Chinese traditional Chinese medicine at a valuation of about $4 billion. Sinopharm and advisers are in talks with advisers about new proposals for a potential privatization, people familiar with the matter said.
By February 7 this year, another ** report was reported by people familiar with the matter that Sinopharm was considering the possible privatization of Chinese traditional medicine, and Sinopharm had contacted banks on financing. One of the people said Sinopharm could also join forces with other investors.
But every time the rumors were refuted.
China Traditional Chinese Medicine is the core platform of the Chinese medicine industry sector of Sinopharm Group, with a complete industrial chain from upstream planting to downstream sales. In terms of product portfolio, China TCM covers related fields such as Chinese herbal medicines, Chinese herbal decoction pieces, formula granules, Chinese patent medicines, Chinese medicine and health, and traditional Chinese medicine. In terms of size, as of the end of June 2023, the company has more than 100 subsidiaries with 17,373 employees.
Recently, China Traditional Chinese Medicine also released a profit forecast announcement for 2023, and it is expected that net profit will increase by 85% to 95% year-on-year last year.
It is worth noting that if the privatization proposal is approved, it will be the first pharmaceutical company in Hong Kong to announce privatization in 2024, after the privatization of Hong Kong-listed Lansen Pharma in 2023. In fact, since 2022, the NASDAQ has staged a wave of privatization, and has begun to affect Chinese concept stocks and the Hong Kong market.
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