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Wuxi repurchases shares

Last updated on 22-Feb-2012 at 10:57 GMT2012-02-22T10:57:24Z

Wuxi repurchases shares

China-based CRO Wuxi PharmaTech has repurchased shares from private equity fund General Atlantic LLC.

According to a statement issued earlier this week Wuxi will buy “all ordinary shares General Atlantic received on February 12, 2012, following the conversion in full of the $35m principal amount of convertible notes plus accrued interest of approximately $864,000.”

Wuxi investor relations director Ron Aldridge told that move is intended "to accelerate EPS growth by reducing our share count.” The deal is expected to close on February 24.

General Atlantic, which along with associated investment entities has held around 46m Wuxi shares – roughly a 9 per cent stake in the company – since 2007 , already lists the Chinese contract research organization (CRO) as a prior holding on its website.

The repurchase follows a few weeks after media speculation that Wuxi’s health profit margins - relative to its western peers – make it a potential takeover target.

At the time Oppenheimer analyst Ingrid Yin told Bloomberg that: “We see a big gap between WuXi and ShangPharma valuations versus their US peers, WuXi and ShangPharma are both very interesting potential targets. They represent a big opportunity in China.”

Aldridge declined to comment on the takeover speculation.

Wuxi will announce its fourth quarter earnings on March 8.

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