China’s WuXi PharmaTech tapping banks for $1.5b IPO for biologics arm

WuXi PharmaTech (Cayman) Inc., China’s biggest contract medical researcher, has picked banks for an initial public offering of its biologics unit that could value the business at about $1.5 billion, people with knowledge of the matter said.

WuXi PharmaTech hired Bank of America Corp. and Morgan Stanley to arrange a Hong Kong share sale for the unit, according to the people, who asked not to be identified because the information is private. The offering could take place as soon as the second half of this year, the people said.

A listing of the biologics business would give investors access to one of the fastest-growing areas of the pharmaceutical industry. Biopharmaceuticals, which are more complex to research and manufacture than other drugs, usually contain live ingredients and can address previously untreatable conditions with higher efficacy and fewer side effects.

WuXi PharmaTech, which previously traded on the New York Stock Exchange, is also considering a domestic listing of the entire group some time after 2016, according to one of the people. Plans are still at an early stage, the person said. Aaron Shi, a spokesman for WuXi, declined to comment.

The offerings would add to the $57.5 billion of first-time share sales in greater China over the past 12 months, according to data compiled by Bloomberg. WuXi PharmaTech was taken private last year in a $3.3 billion deal by founder Ge Li and a group of investors including Ally Bridge Group, Boyu Capital, Hillhouse Fund and Singapore’s Temasek Life Sciences Pte. New WuXi Life Science Ltd. is the name of WuXi PharmaTech’s holding company after the buyout.

WuXi PharmaTech said Jan. 8 it started construction on a biologics center at its Shanghai headquarters, which its clients could use for drug discovery and manufacturing. The company said it would invest $120 million in the facility, which will accommodate 800 scientists and cover about 250,000 square feet (23,000 square meters).

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Natasha Khan, Vinicy Chan and Regina Tan

Bloomberg

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

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