China Biologic Pops 3% on Deal To Go Private at $4.76 Billion Equity Value

China Biologic is set to follow the footsteps of Yintech Investment and a slew of other Chinese U.S.-listed firms.
Anthony RussoNov 19,2020,17:55

Shares of China Biologic Products (Nasdaq: CBPO) traded 3% higher after announcing that it will be taken private via a plan of merger with CBPO Holdings Ltd. and CBPO Group Ltd. at an equity value of around $4.76 billion.

Under the definitive deal, each share of the biopharmaceutical firm will be worth $120, representing a 17% premium from Sept. 17, 2019, which marks the previous trading day that it announced it received a "going-private" proposal.

As of right now, members under the so-called “Buyer Consortium and the “Rollover Management Members” own roughly 69% of the total outstanding shares, according to China Biologic.

Before the Beijing-based company announced its plans today, another Chinese U.S-listed firm Yintech Investment (Nasdaq: YIN) said it completed a merger of its own to go private Wednesday after the markets closed. The deal values the provider of investment and trading services at roughly $540.2 million, or $7.30 per share. It first announced it plans to go private in August.

The move follows a slew of buyout offers and deals regarding U.S.-listed Chinese firms this year, as relations between Washington and Beijing continue to worsen. Earlier this week, Bloomberg reported that the U.S. Securities and Exchange Commission is planning on proposing a regulation by the end of 2020 that would result in Chinese firms getting delisted from American bourses if they do not comply with their auditing standards.

Washington has been aiming to do a better job in protecting the American investor after Luckin Coffee (Nasdaq: LK) allegedly fabricated more than $300 million in sales earlier this year.

As a result, many Chinese firms have at least been mulling buyout options, or preparing for the worst and heading private.

Founded in 2002, China Biologic made its Nasdaq trading debut in December 2009. Since then, its shares have jumped more than 1000% to date.

China Biologic expects the merger to close in the first half of next year.

Topics:China Biologic, Yintech Investment