Analysis & Comment

Henlius Biotech launches $477 million HK IPO, to test market amid protests

HONG KONG (Reuters) – Shanghai Henlius Biotech, backed by Chinese conglomerate Fosun International (0656.HK), 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, which started gauging investor demand on Aug. 26, 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-$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 shows.

The float will be a key gauge of investor appetite after China’s Alibaba Group Holding Ltd (BABA.N) last month delayed plans for a $15 billion listing amid the city’s political turmoil.

Henlius, a developer of innovative drugs and biosimilars – which are not exact replicas but are as effective as the original drug, did not immediately respond to a request for comment.

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