HUTCHMED launches Hong Kong initial public offering (IPO)

HONG KONG: HUTCHMED (China) Limited announced the launch of its Hong Kong initial public offering (IPO), which forms part of the global offering of 104 million new ordinary shares and the proposed primary listing of its ordinary shares on the Main Board of The Stock Exchange of Hong Kong Limited under the stock code “13”.

The Company will receive all of the net proceeds from the Global Offering.

The Global Offering initially comprises 13 million new Shares under the Hong Kong Public Offering and 91 million new Shares under the international offering, representing approximately 12.5% and 87.5% of the total number of Offer Shares in the Offering, respectively, subject to re-allocation between the Hong Kong Public Offering and the International Offering for any over-subscriptions in the Hong Kong Public Offering and over-allotment.

In addition, HUTCHMED expects to grant the international underwriters an over-allotment option to purchase up to an additional 15.6 million new Shares in the International Offering, representing not more than 15% of the Offer Shares initially available under the Global Offering.

The offer price for the Global Offering will be not more than HK$45.00 per Share, which is equivalent to approximately US$29 per American depositary share (ADS) or £4.15 per Share.

The Company is expected to set the Offer Price on or about June 23, 2021 Hong Kong time by making reference to, among other factors, the closing price of the ADSs on the Nasdaq Global Select Market and the Shares on the AIM market of the London Stock Exchange (AIM) on the last trading day on or before the price determination date and investor demand during the marketing process. Shares will be traded on the SEHK in board lots of 500 Shares.

The Company expects to announce the Offer Price so determined on June 23, 2021.

The Company has entered into cornerstone investment agreements with entities affiliated with The Carlyle Group Inc., Canada Pension Plan Investment Board, General Atlantic, HBM Healthcare Investments and CICC Grandeur Fund.

Under such agreements, they have agreed to, subject to certain conditions, subscribe for such number of Offer Shares that may be purchased with an aggregate amount of HK$2,535 million (approximately US$325 million) at the Offer Price, representing approximately 54% of the Offer Shares initially being offered under the Global Offering assuming such Offer Shares are sold at the Maximum Offer Price, which percentage is subject to the Over-allotment Option. Such Offer Shares are being sold in reliance on Regulation S or another exemption from the registration requirements of the U.S. Securities Act of 1933 and this cornerstone placing will form part of the International Offering.

The Company’s ADSs, each representing five ordinary shares of the Company, will continue to be listed and traded on the Nasdaq, and the Shares will remain admitted to trading on AIM. Investors in the Global Offering will only be able to purchase Shares and will not be able to take delivery of ADSs. Upon listing, the Hong Kong-listed Shares will be fully fungible with the Shares represented by ADSs listed on Nasdaq and the Shares admitted to trading on AIM.

HUTCHMED plans to use the net proceeds from the Global Offering primarily to advance its late-stage clinical programs as well as its pipeline of clinical-stage and preclinical drug candidates, further strengthen its commercialization, clinical, regulatory and manufacturing capabilities, fund potential global business development and strategic acquisition opportunities and for general corporate purposes.

Morgan Stanley Asia Limited, Jefferies Hong Kong Limited and China International Capital Corporation Hong Kong Securities Limited are the joint sponsors for the proposed Global Offering.