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The H share convertible bonds will bear an interest rate of 3
percent per annum if issued, at an initial conversion price of
HK$38 per share, HEC Pharma said in a stock filing on Tuesday
night.
The drugmaker, based in Yichang in central China's Hubei
province, is planning to use the funds to acquire drugs and
other pharmaceutical products, it said.
Blackstone, as a long-term strategic investor, will also improve
HEC Pharma's strategy, operations management and international
cooperation, it added.
Shares in HEC Pharma tumbled 7.4 percent to HK$33.60, hitting
their lowest since April 18.
Blackstone's investment comes as Chinese drugmakers are faced
with tighter regulatory scrutiny and rebuilding public trust
after fresh scandals over faulty vaccines sparked anger on
social media in the country last month.
Fitch Ratings said in a report on July 31 such scandals
highlighted the risks facing China's pharmaceutical companies,
which focus primarily on the bulk production of a small number
of products, making them vulnerable to safety incidents.
Seventeen-year-old HEC Pharma develops, manufactures and sells
pharmaceutical products used to treat endocrine and metabolic
diseases and cardiovascular diseases, and in the anti-viral
field.
HEC Pharma has recently issued a positive profit alert for its
interim results for the first half, expecting that it will
record an at least 110 percent increase in profit attributable
to equity shareholders compared with the same period last year.
Blackstone raised about $9.4 billion in June for two new funds -
$7.1 billion in the largest-ever fund dedicated to real estate
investments in Asia, and its first private equity fund for the
region.
(Reporting by Kane Wu; Editing by Jan Harvey)
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