① New Novartis announced that it plans to stop trading and plan to acquire 100% of Baike Biotech's shares. Both parties are assets of the CSPC Group. ② In the past two years, New Novell has acquired assets under the Shiyao Group, including Shiyao Shengxue and Jushi Bio. ③ Experts believe that this acquisition may involve capital transfer, and at the same time enhance the level of innovation of mergers and acquirers to win the favor of capital.
Financial Services Association, January 10 (Reporter He Fan) This evening, Sinovay (300765.SZ), a “pharmaceutical bull stock” under Shiyao Group (1093.HK), announced that it plans to stop trading and plan to acquire 100% of Baike Biotech's shares. The latter's main business is biological product research and development, and it is also an asset of the CSPC Group.
However, in the past two years, New Novus has been merging and acquiring the assets of the Shiyao Group. It completed the merger and acquisition of Shiyao Shengxue in 2022 and initiated the merger and acquisition of Jushi Biotech in 2023.
Industry insiders told the Financial Federation reporter that the proposed acquisition of Baike Biotech this time may involve capital transfer, and at the same time increase the level of innovation of the mergers and acquirers to win the favor of capital.
Will the purchasing company achieve an annual profit of more than 2 billion dollars after delivery?
This evening, Sinovay announced that the company is planning to issue shares and pay cash to purchase assets and raise supporting capital and related transactions. The target asset is 100% of the shares of Shiyao Group Baike (Shandong) Biopharmaceutical Co., Ltd. The transaction is expected to constitute a major asset restructuring, not a restructuring and listing. Trading of the company's shares has been suspended since the opening of the market on January 11, 2024.
According to Baike Biotech's official website, the company's representative product is “Jin Youli”, or “polyethylene glycolated recombinant human granulocyte stimulating factor injection”. According to reports, it is China's first long-acting recombinant human granulocyte stimulating factor injection with independent intellectual property rights. It is a new class 1 drug in China for the treatment of non-myeloid malignant tumors.
However, at the time of press release, Baike Biotech's official website suddenly couldn't be opened, and the page said, “The website is temporarily inaccessible. The site may be inaccessible for one of the following reasons...”
(Baike Biotech's official website)
A CIFA reporter saw on the recruitment website that Shiyao Group Baike (Shandong) Biopharmaceutical Co., Ltd. is a wholly-owned subsidiary of CSPC Group, with a registered capital of 735 million yuan and nearly 300 employees. The company is a national high-tech enterprise specializing in R&D, production and sales of biological products, and is the biological industry base of CSPC Group. Up to now, the company has total assets of 2.64 billion yuan and fixed assets of 355 million yuan. The company is gradually expanding its product line through independent research and development or cooperative development. The main direction is monoclonal antibodies, fusion proteins, etc., all of which are new biological drugs with independent intellectual property rights. The technical level and quality standards are at the international level. The company is developing more than 7 new varieties, covering the fields of metabolism, respiratory system, allergy, anti-cancer, etc. After delivery, the project is expected to achieve annual sales revenue of more than 10 billion yuan, profits of more than 2 billion yuan, and taxes of more than 1 billion yuan, which have good economic benefits.
Li Changcheng, a veteran of the pharmaceutical industry, believes in an interview with a reporter from the Financial Federation that this transaction may be a capital operation for listed companies. Recently, the stock price performance of CSPC Group in the Hong Kong stock market is quite average. This time, on the one hand, it is a capital transfer, and on the other hand, it is improving the level of innovation of mergers and acquisitions to win the favor of capital.
Bullish stocks to “buy out”?
A CIFA reporter noticed that compared to the average performance of Shiyao Group in Hong Kong stocks, in the past year, New Novartis can be called “limitless” in A-shares.
According to Wind data, in the Shenwan pharmaceutical and biological industry in 2023, the highest annual increase was in Bailey Tianheng (336.51%), followed by New Novell (320.58%). However, if the closing price up to today is used as a node to calculate the rise and fall, New Novartis surpassed Bailey Tianheng with an increase of 299.91%, making it the A-share biomedical stock with the highest increase since the beginning of 2023.
The watershed that brought New Novus's stock price to a “helicopter” was that in August 2023, New Novell announced plans to implement a cash capital increase for Shiyao Group Jushi Biopharmaceutical Co., Ltd. to obtain more than 51% of the shares in the target company to achieve control of the target company. The relevant parties have signed the “Intent Agreement on the Capital Increase of CSPC Group Jushi Biopharmaceutical Co., Ltd.” on August 30, 2023. After the capital increase is completed, CSPC Innovation will develop into an innovative company integrating R&D, production and sales of biopharmaceuticals, functional foods, and functional raw materials.
Just last week, Sinovay announced that it has completed the acquisition of Jushi Biotech. The company has completed the first capital increase payment of 1 billion yuan in accordance with the “Capital Increase Agreement of Shiyao Group Jushi Biopharmaceutical Co., Ltd.”, and the equity transfer related to Jushi Biotech has already been completed. Jushi Biotech has recently completed the registration procedure for industrial and commercial changes and obtained a “business license” issued by the Shijiazhuang High-tech Industrial Development Zone Administrative Examination and Approval Bureau.
Looking back, in July 2021, Sinovay also announced that it intended to purchase 100% of its shares in Shiyao Shengxue by issuing shares to the controlling shareholder, Shiyao Group Enbipu Pharmaceutical Co., Ltd., at a transaction price of 800 million yuan.
In December 2022, the company stated on the investor interactive platform that it has now completed the asset transaction of Shiyao Shengxue. According to the “Corporate Accounting Standard No. 20 - Enterprise Merger”, Shiyao Shengxue's annual results will be included in the company.