April 12, 2019 / 6:46 AM / 9 days ago

China's Hansoh Pharmaceutical re-files for Hong Kong IPO -sources

HONG KONG, April 12 (Reuters) - Hansoh Pharmaceutical Group Co Ltd has re-filed its application to conduct an initial public offering (IPO) in Hong Kong that could fetch the Chinese drugmaker at least $500 million, two people with direct knowledge of the matter said on Friday.

Hansoh Pharmaceutical had initially looked to raise up to $1 billion, sources previously told Reuters. One of the people on Friday said the IPO could raise $800 million to $1 billion whereas another said $500 million to $800 million.

The drugmaker’s draft IPO prospectus appeared on the Hong Kong stock exchange website late on Thursday. Its previous application was filed in September and lapsed six months later. It was not clear why the application was allowed to lapse.

Companies have raised $2.9 billion through Hong Kong listings so far this year, lagging the $6.4 billion raised on New York’s Nasdaq, Refinitiv data showed.

Hong Kong topped all other exchanges globally last year with stock market listings raising $36.3 billion. This year, however, is widely expected to be slower due to thinning numbers of Chinese companies looking to go public, particularly in tech.

Hansoh Pharmaceutical’s drug portfolio covers central nervous system diseases, oncology, anti-infectives, diabetes, and gastrointestinal and cardiovascular therapies, the prospectus showed.

Those therapeutic areas accounted for 62.1 percent of total pharmaceutical sales in China in 2017 and grew faster than the Chinese pharmaceutical industry as a whole, the prospectus said.

Hansoh Pharmaceutical made a net profit of 1.9 billion yuan ($282.76 million) on revenue of 7.7 billion yuan in 2018, an increase of 19 percent compared with the year earlier.

It makes most of its revenue from oncology products, the prospectus showed.

The drugmaker plans to use IPO proceeds for research and development - including existing and future domestic and overseas drug development - upgrading and building production lines, and promotional purposes, it said in the prospectus.

Citigroup and Morgan Stanley are joint sponsors for the IPO.

Hansoh Pharmaceutical did not respond to emails requesting comment. ($1 = 6.7194 Chinese yuan renminbi) (Reporting by Julia Fioretti; Additional reporting by Julie Zhu; Editing by Christopher Cushing)

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