Wuxi repurchases shares

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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 Outsourcing-pharma.com 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.

Related topics: Clinical Development, Phase III-IV

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