HUTCHMED Divests 45% Stake In Shanghai Hutchison Pharmaceuticals For $608 Mln

Hutchison China Meditech

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(RTTNews) - HUTCHMED (China) Limited (HCM) announced it has entered into two agreements to sell its 45% equity stake in Shanghai Hutchison Pharmaceuticals Limited for approximately US$608 million in cash to GP Health Service Capital Co., Ltd and Shanghai Pharmaceuticals Holding Co., Ltd.

Shanghai Hutchison Pharmaceuticals Limited or SHPL primarily manufactures, sells and distributes its own-brand prescription medicines in China, predominantly for cardiovascular diseases. SHPL is a 50:50 joint venture established between HUTCHMED and Shanghai Pharma in 2001.

HUTCHMED plans to invest the proceeds from the sale of SHPL to further develop its internal pipeline and drive its core business strategy forward.

Under the terms of the agreements, GP Health Service Capital has agreed to acquire a 35% equity interest in SHPL from HUTCHMED for approximately US$473 million in cash, and Shanghai Pharma has agreed to acquire a 10% equity interest from HUTCHMED for approximately US$135 million in cash and will hold a total of 60% equity interest in SHPL after the transactions. Out of its 35%, GP Health Service Capital retains the right to designate a third party investment fund to acquire up to a 10% equity interest in SHPL. HUTCHMED will retain a 5% equity interest in SHPL after the transactions.

HUTCHMED expects to record a gain on disposal of approximately US$477 million before taxation.

The transactions are expected to close by the end of the first quarter of 2025.