After Dispute, Sinovac Delays 2017 Financials
The maker of vaccines blamed the chairman of a subsidiary for its delay in filing the company's 2017 annual report.
Sinovac Biotech Ltd. (Nasdaq: SVA) announced today it would postpone the filing of its 2017 annual report because of recent actions by a chairman of its primary subsidiary, Sinovac Beijing, who physically disrupted the operations of its offices earlier this month, the company claimed.
Today's announcement followed a physical altercation that occurred 10 days ago, when chairman of Sinovac Beijing, Aihua Pan, allegedly led a dozen people into Sinovac Beijing's headquarters, who limited the physical movements of the company's employees and attempted to seize its legal and financial documents, Sinovac said.
The disruption at Sinovac, which makes biopharmaceutical products, led to an interruption of electrical power to the production of hepatitis A and seasonal flu vaccines, which then had to be destroyed as they were potentially damaged.
Pan is also chairman of Shandong Sinobioway Biomedicine Ltd., which holds a 27 percent stake in Sinovac Beijing. He claimed that Sinovac wrongfully withheld financial statements for Sinovac Beijing from its shareholders, an allegation Sinovac denied.
The altercation between the two companies apparently stemmed from disputes over privatizing Sinovac, an ongoing process as multiple parties, mainly a consortium led by Sinobioway, and chairman and chief executive officer of Sinovac, Weidong Yin, which placed competing bids for its ownership. The board of Sinovac has accepted Yin's proposal. The going-private deal was to be finalized by Thursday, but the company announced today that it had filed an extension until May 26.
Sinovac said today that Pan's actions were the reason for the delay of filing its 2017 annual report.
While the alleged confrontation took place nearly two weeks ago, "One of our buildings, where the finance department is located, is occupied, and employees of Sinovac Beijing are not permitted to enter," the company said today.
Previously, Sinovac said it "has never refused to provide the financial statements," and "will deliver its audited 2017 annual financials to Sinobioway upon completion of its annual audit."
"The company is working diligently with its auditor to file the 2017 Annual Report as soon as practicable," Sinovac said in a statement today.