China’s YishengBio eyes US capital markets via SPAC route

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Yisheng Biopharma has abandoned its Hong Kong IPO and turned instead to the Nasdaq via the SPAC route in a deal that is expected to be sealed by the first quarter of 2023.

The company, which will be renamed YS Biopharma, said it will merge with the US-listed blank-cheque company, Summit Healthcare Acquisition Corp.

A SPAC is a special purpose acquisition company and a shell corporation listed on a stock exchange with the purpose of acquiring a private company, thus making it public without going through the traditional initial public offering process. A SPAC is also known as a blank-cheque company.

The deal puts Yisheng Biopharma at a pre-cash equity value of USD834 million. If the merger continues as scheduled, it is expected to receive approximately USD200 million, currently held in Summit’s trust account, and USD30 million from private investors Snow Lake Capital and the Alliance Fund.

Summit Healthcare was set up by Fu Wei, founder of the private equity player CBC Group, whose arm R-Bridge Healthcare Fund struck a USD40 million royalty-backed financing for Yisheng Biopharma earlier this year.

The Rabies vaccine is the pillar product of Yisheng Biopharma as it is the only one that generates revenue, Frost & Sullivan said.

Wilson Sonsini, Jingtian & Gongcheng, and Maples Group advised Yisheng Biopharma, while Cooley and Ogier acted as Summit Healthcare’s counsel.