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AstraZeneca planning China business spin off -FT
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(Reuters) – Drugmaker AstraZeneca is drafting a plan to spin off its China
(Reuters) – Drugmaker AstraZeneca is drafting a plan to spin off its China business, and listing a separate unit in Hong Kong is being viewed as an option, the Financial Times reported on Sunday.
A separation might not ultimately take place, the report said, citing people familiar with the matter, with one of them saying listing the entity in Shanghai was also possible.
The company would seek to be a patriotic company in China that “loves the Communist Party”, its China president said in May. Last year, the country accounted for 13% of AstraZeneca’s total sales, and the company is China’s biggest drugmaker.
The spin off could protect AstraZeneca from tensions between China and other global powers, while the company retained control of the business, the FT’s report said.
It added the idea has been around for years but was recently sidelined by a global biotech downturn.
AstraZeneca said it did not comment on “rumours or speculations around future strategy or M&A.”
(Reporting by Bharat Govind Gautam in Bengaluru; additional reporting by Rishabh Jaiswal; Editing by Chris Reese and Diane Craft)
A spin-off is a corporate strategy where a company creates a new independent company by selling or distributing new shares. This often allows the parent company to focus on its core business while providing shareholders with a stake in the new entity.
A listing refers to the process of a company's shares being traded on a stock exchange. It allows the company to raise capital from public investors and increases its visibility in the market.
Mergers and acquisitions (M&A) are transactions where companies consolidate through various types of financial transactions. A merger is the combination of two companies into one, while an acquisition is when one company purchases another.
Corporate strategy refers to the overall plan for a company to achieve its goals and objectives. It encompasses decisions related to resource allocation, business expansion, and competitive positioning.
Market capitalisation is the total market value of a company's outstanding shares of stock. It is calculated by multiplying the share price by the total number of shares and is used to assess a company's size and investment potential.
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