Ransom 300 Trillion Won... London Stock Exchange Market Cap No.1
AstraZeneca, the UK's largest listed company with a market capitalization of 300 trillion won, is reportedly considering a plan to spin off its business in China and relist it separately. This appears to be a desperate measure to escape the influence of the US-China conflict.
Major foreign media outlets reported on the 18th (local time), citing sources, that AstraZeneca is discussing a plan to separate its business in China into a separate entity and relist it on the Hong Kong Stock Exchange.
AstraZeneca is a joint venture between a Swedish pharmaceutical company and a British pharmaceutical company, simultaneously listed on both countries' stock exchanges. As of the closing price on the 16th, its market capitalization was 183 billion pounds (approximately 300.11 trillion won), ranking first in market capitalization on the London Stock Exchange in the UK.
According to foreign media reports, AstraZeneca has been negotiating with bankers over the past few months to advance these discussions, and is also considering listing the separated entity on the Shanghai Stock Exchange instead of Hong Kong.
An advisor to AstraZeneca said, "The plan to separate and relist the Chinese entity has been an issue discussed for years, but considering that biotech stocks are undervalued in the stock market due to factors such as economic recession, we are waiting for the right time."
The spin-off and relisting is a way to reduce exposure to the risks of the US-China conflict and policy uncertainties of the Chinese government while maintaining management control. Foreign media also reported that other multinational companies with significant Chinese business divisions are showing similar movements.
This business restructuring draws more attention as it comes at a time when AstraZeneca is aiming to expand its market in China. AstraZeneca, which has produced innovative clinical results in the fields of oncology and rare diseases, has recently focused on expanding its business in China by obtaining new approvals for anticancer drugs and rare disease treatments from Chinese authorities.
China is a very attractive market for global pharmaceutical companies like AstraZeneca due to its large population, aging demographics, and increasing disease trends caused by smoking, pollution, and Westernized diets. Last year, AstraZeneca's business in China accounted for about 13% of its total sales. In the first quarter of this year, AstraZeneca's sales in China were approximately 1.6 billion dollars.
Pascal Soriot, CEO of AstraZeneca, expressed his commitment to expanding the Chinese business during a press conference after returning from a visit to China in April, stating, "We are not limiting ourselves in acquiring local biotech companies in China." Last month, AstraZeneca also signed a license agreement worth 600 million dollars with Lanova Medicines, a biotechnology company headquartered in Shanghai.
Michel Demar?, Chairman of AstraZeneca, identified China as a market that is neither too close nor too distant in an interview with the British media last month, saying, "We are working to cope with growing geopolitical risks."
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