Hong Kong’s Prenetics goes public in US via $ 1.7 billion SPAC deal
What’s new: Unicorn testing for Covid Prenetics Group Ltd. goes public on the Nasdaq stock market through a specialist acquisition company with a combined capital value of $ 1.7 billion, the largest among companies in Hong Kong.
Biotech Company to Merge with Artisan Acquisition, a Special Purpose Acquisition Company (SPAC), founded by Adrian Cheng, Managing Director of New World Development and grandson of the late Hong Kong real estate and jewelry mogul Cheng Yu-tung.
The deal will generate $ 459 million in proceeds, including $ 339 million in cash raised by Artisan and $ 120 million from private investment. The transaction is expected to close by the first quarter of 2022, the company said in a statement on Thursday.
Prenetics predicts that its revenue will grow 215% to $ 205 million in 2021 and reach $ 600 million in 2025.
Background: Founded in 2014, Prenetics was a genetic and DNA testing company backed by Alibaba Group Holding Ltd. and Ping An Insurance Group Co. The biotech company has been riding a global wave of Covid-19 testing and PSPC-related agreements since 2020. A PSPC is a company formed for the sole purpose of acquiring a private company to go public and basically starts out as a shell company with no assets other than limited cash and investments.
The PSPC frenzy allows companies to forgo the classic route of the initial public offering for something with more certainty. The Hong Kong Stock Exchange on Friday offered to allow SPAC listings, seeking public comment. The proposal is limited to institutional investors only. The U.S. Securities and Exchange Commission said in April it would increase scrutiny of the accounting and growth projections of new public startups.
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