* First sizeable IPO to test market sentiment amid HK’s protests
* Henlius sets IPO price range at HK$49.6 to HK$57.8 -term sheet
* Company valued at $3 bln to $3.5 bln prior to IPO -term sheet
* Qatar Investment Authority is biggest cornerstone -term sheet (Adds context, company background)
By Julie Zhu
HONG KONG, Sept 11 (Reuters) - Shanghai Henlius Biotech launched on Wednesday its Hong Kong IPO of up to $477 million, a term sheet showed, the first sizeable float to test market sentiment amid the city’s political unrest.
The company, backed by Chinese conglomerate Fosun International Ltd, started gauging investor demand on Aug. 26. It is selling 12% of its enlarged share capital in the initial public offering at a price range of HK$49.6 to HK$57.8 ($6.33-$7.37), according to the term sheet seen by Reuters.
The price range represents a valuation of about $3 billion to $3.5 billion prior to the float, versus $3 billion in a pre-IPO fundraising in November 2018.
Henlius has also lined up a total of $140 million from four cornerstone investors. Qatar Investment Authority has made the biggest commitment of $90 million, the term sheet showed.
The float will be a key gauge of investor appetite after China’s Alibaba Group Holding Ltd last month delayed plans for a $15 billion listing amid political turmoil in the city which has seen months of frequently violent protests triggered by an unpopular Chinese extradition bill.
Henlius declined to comment.
Prague-based consumer lender Home Credit which has a sizeable Chinese business, is also expected to launch its IPO of over $1 billion as soon as this month, part of a series of sizeable floats planned in the city.
Both deals would be a boost for Hong Kong’s stock exchange, which is lagging behind its New York rivals in the annual battle to be the leading global listings venue. So far this year, companies have raised $10.8 billion in new listings in Hong Kong, well short of the $38.4 billion raised in New York, according to Refinitiv data.
Co-founded in 2010 by Scott Liu, previously with U.S. biotech giant Amgen Inc, Henlius develops innovative drugs and biosimilars - drugs which are not exact replicas of established drugs but are as effective.
Apart from one biosimilar product commercially launched in China, its drug portfolio covers over 20 biologic candidates in various stages of clinical development, according to its updated IPO prospectus.
The firm booked a loss of 158 million yuan ($22 million) in the first quarter of the year, more than doubling the loss of the same period of 2018. It recorded an annual loss of 505 million yuan last year.
Henlius is set to price its IPO on Sept. 18 and trading of its shares is scheduled to start on Sept. 25.
Bank of America Merrill Lynch, CICC, Citigroup and CMB International are among the deal’s sponsors. ($1 = 7.1049 Chinese yuan) ($1 = 7.8402 Hong Kong dollars)
Reporting by Julie Zhu; Editing by Himani Sarkar and Christopher Cushing