Category: Mergers & Acquisitions

China’s Luye Pharma Completes Acquistion Of Acino’s Transdermal Drug Delivery System For US$260 Million

Luye Pharma Group Ltd. (02186.HK), a professional pharmaceutical enterprise focused on R&D and manufacture of innovative pharmaceutical products has announced the completion of its acquisition of the transdermal drug delivery systems (TDS) business, Acino which is located in Zurich, Switzerland, according to a press release.

Acino has established itself as a global leader in the niche transdermal markets. The company is said to be one of the largest independent TDS manufacturers in Europe, with a product portfolio primarily focused on higher margin specialty patch categories such as central nervous system (CNS), pain and hormone spaces.

Some of the company’s notable commercialized and complex formulations include Rivastigmine, Buprenorphine, Fentanyl and fertility control patch. Post acquisition, Acino will retain the marketing rights to certain of these patched in strategic emerging markets.

The transaction saw Luye Pharma acquiring the TDS business from Acino, through the purchase of the entire issued share capital of Acino AG and Acino Supply AG for an amount of €245 million (about US$260 million).

This acquisition will allow Luye Pharma to learn and adopt practices from the integration of its acquired business. Greatly enhancing Luye Pharma’s developmental efforts in R&D, manufacturing, international registration, and market promotion of new formulation products to international standards.

“As we execute our international strategy, this transaction serves as an important milestone,” says Yehong Zhang, the chief executive of Luye Pharma, “This acquisition will significantly enhance Luye Pharma’s international capabilities and accelerate its penetration into broader therapeutic areas and geographies.”

In addition, the TDS business, with its high-quality factories with EU GMP certificate and certification from the U.S. FDA, will help Luye Pharma in meeting and exceed international standards in production, quality control, and global operations.

At the same time, Acino with its mature sales network and international presence in many developed markets around the world – especially the European region will definitely aid the giant pharmaceutical enterprise to pave the way for its mission of globalization.

The global market sales of transdermal patches reached over 5 billion Euros in 2014 and are expected to hit 6.4 billion Euros by 2020, with a projected compound annual growth rate greater than 4%1. The global market for TDS business is huge with strong growth potential.

It would also appears that Luye Pharma is leveraging its growth on M&A as Luye Pharma has also previously acquired Healthe Care Australia in April this year for an undisclosed amount. Acino, which acquisitions has begun since July is, in fact, its second acquisition.

Still, Luye Pharma, the leading Chinese pharmaceutical enterprise will continue to serve and promote human health through professional technology, especially when the China mainland is an emerging market which is facing the challenges of an aging population that are accompanied by potential patients of chronic diseases, which represents a substantial market for TDS. At present, there are currently 260 million people suffering from chronic diseases in China.

Despite that, the company is moving forward and working to develop Luye Pharma into one of the most respected leading global pharmaceutical enterprises in the world. The enterprise, since inception, has adopted innovation, being one of the pioneering Chinese pharmaceutical enterprises to have conducted clinical trials in international markets. Luye Pharma currently has 5 innovative products at various stages of clinical research with significant breakthroughs in the U.S.

On a similar note, Luye Pharma is backed by CITIC Private Equity, which 5.92% ownership of Luye Pharma Group remains unchanged since 2014, according to the company’s 2015 annual report.

For more information, please visit http://www.luye.cn/

By Vivian Foo, Unicorn Media

KFit Acquires Groupon Malaysia To Expand Beyond Fitness Into Local Services

KFit, a year-old service offering gym and healthcare services, has raised more than US$12 million from investors in its Series A funding round has announced today that it has acquired the Groupon Malaysia in an undisclosed deal. The startup is backed by Sequoia Capital India, 500 Startups, Southeast Asia Venturra Capital, SIG and Axiata Digital Innovation Fund.

The news was among expectations as three months earlier the company has acquired the e-commerce group’s Indonesia operations. whereby KFit says the deal is in line with its plan to become a leader in Southeast Asia’s online-to-offline space, short for O2O. Similarly, the company has also launched a deals app called Fave a few months ago whereby the functions of Fave are similar to Groupon.

The reason behind this series of acquisition and the pursuit of the offline-to-online model has been influenced by the signs of potential in China with China’s largest O2O player, Meituan-Dianping, raising US$3.3 billion earlier this year at a valuation of US$18 billion.

“Millions of local businesses are booming in China thanks to the adoption of O2O services, with hundreds of millions of consumers embracing these platforms as part of their day to day lives. The convenience and value benefits of these platforms are key drivers of this new norm. This future is inevitable for Southeast Asia and we hope to be at the forefront of this exciting shift,” KFit CEO and co-founder Joel Neoh said in a statement.

Neoh, the founder of Groupon Malaysia has previously helmed Groupon in Asia Pacific. With this, KFit said Groupon Malaysia will share a fate similar to Groupon Indonesia, whereby it will transition to Fave in early 2017. Essentially, this means that we will see it add new categories for fitness, wellness and other gym-related sectors to its current commerce business. KFit also said that it will retain around 90 percent of staff, with senior Groupon Malaysia executives likely to move on to new roles inside the company.

“This acquisition will see Groupon Malaysia transition to Fave in early 2017 and expand Fave’s offerings to cover restaurants, beauty, wellness, gyms, studios, hotels, holidays, leisure, entertainment, and professional services,” KFit explains.

Founded in April 2015, KFit started out by offering unlimited gym and fitness classes – akin to US-based US$400 million ClassPass – for a fixed monthly fee. It tweaked its model this year, limiting its membership to 10 classes per month, and then branched out into deals for services like massage, spa, beauty and salons as well.

With the present events unfolding, KFit is diverging and setting itself apart from its US predecessor. Instead of becoming a fitness sharing platform in Asia, the company now walks the path of becoming an O2O company as it expands to various other verticals such as food and restaurants, beauty and wellness, and lifestyle and activities. The platforms under the KFit Group – Fave, Groupon Indonesia and KFit – have connected millions of customers to thousands of offline businesses in key Southeast Asian market centers.

“With Groupon Indonesia achieving nearly 2 times growth since our acquisition, we are confident that the same growth principles will bring an exciting new local commerce offering to Malaysia,” said KFit co-founder and CEO Joel Neoh.

Post-acquisition, Groupon Malaysia, an e-commerce marketplace connecting millions of subscribers whereby local merchants will transition into Fave and cover restaurants, beauty, wellness, gyms, studios, hotels, holidays, leisure and entertainment as well.

KFit is a definite startup to note as the Malaysia-based startup within this less than one-year period has raised over US$15 million and is backed by high-profile investors such as Sequoia Capital and 500 Startups, among others.

For more information, please visit KFit at Crunchbase for the company’s timeline activity.

By Vivian Foo, Unicorn Media

Phillipines Jollibee Completes Buyout Of Happy Bee In China

Fast food service giant Jollibee Foods Corp (JFC) is confirmed the full ownership of Happy Bee Foods Processing Pte Ltd after it has secured government and regulatory approval in China to buy out its joint venture partner. Its wholly-owned subsidiary, Jollibee Worldwide Pte Ltd (JWL) acquired the remaining 30 percent stake in the China-based food manufacturer Hua Xia Harvest Holdings Pte Ltd., through an equity-and-asset swap deal valued at US$10.4 million.

This move lies in line with the Asian firm’s target as it seeks to rival McDonald to become one of the world’s top 10 fast food brand. Looking at its present oversea growth, the Asian food company has a total operation of 22 commissaries worldwide, that is 15 in the Phillippines, three in China and the United States as well as one in Vietnam. In a statement, the company said that it would continue to pursue an aggressive drive to buy more overseas companies with ticket sizes up to US$100 million.

This acquisition frenzy has begun in 1994 when it first acquired 80% of Greenwich Pizza in the Philippines. Since then, the Filipino fast food chain has more than 10 companies under its belt with its latest acquisition, prior to this, happening late last year at a 40 percent stake in US-based brand Smashburger Master LLC for US$99 million.

But aside from its ambitious appetite, another reason behind this partnership is so that Happy Bee can solely support the continued growth of its flagship restaurant Yonghe King in China, which is one of JFC’s largest business in China with a total of 316 stores which contributes 8 per cent to JFC’s worldwide system-wide sales.

“The objectives behind the acquisition of the 30 per cent ownership of Happy Bee which gave JFC 100 per cent ownership of the food processing facility are to enable JFC to concentrate on supporting the growth of its Yonghe King business and on further improving its food quality and increasing the assurance of its food safety,” says Jollibee’s Vice President Valerie Amante.

Henceforth, with this change in ownership, Happy Bee will no longer produce and sell food products to institutions other than JFC’s restaurant businesses. It is noted that the transaction is basically an asset for equity swap, with Hua Xia selling its 3,518,018 shares in Happy Bee priced at $2.96 per share. The transfer of shares and assets are expected to be completed within 2016.

On another note, JFC added that it is also exploring a joint venture possibility with ISE Foods Inc, a Japanese firm for an egg production facility in the Philippines.

For more information, please visit http://www.jollibee.com.ph/

By Vivian Foo, Unicorn Media

China’s Ctrip.com To Buy Out Skyscanner In US$1.74 Billion Deal

Shanghai-based Ctrip.com International Ltd, one of China’s largest online travel agency, announced on Wednesday that it is to acquire Skyscanner Holdings Ltd, a travel search website in a deal valuing the Edinburg-based startup at an amount of US$1.74 billion. This will be the sixth acquisition for the China online travel website after it last acquired Sunaya for US$16 million in July 2015.

Under the terms of the deal, which is expected to close by year’s end, Skyscanner’s current management team will continue to run its operations independently. The details of the deal are still under negotiation but will mainly consist of cash, with the rest consisting of Ctrip ordinary shares and loan notes.

Founded in 2003, Skyscanner was set up to solve the frustration with finding cheap flights by creating a platform which enables users to compare prices from different travel sites when searching for flights, hotels, and rental cars. The website, to date, is available in more than 30 different languages and currently serves about 60 million monthly active users.

Prior to this, Skyscanner was reportedly exploring a sale or an initial public offering. The startup in January has a funding round securing 128 million pounds (about US$158 million) from a group of investors consisting of Malaysia’s sovereign fund, Khazanah Nasional and Yahoo Japan Corp which brought its value to US$1.6 billion. Skyscanner’s investors also include Sequoia Capital, one of Silicon Valley’s largest venture-capital firms.

Ctrip.com, on the other hand, was founded in 1999 and is one of China’s biggest travel businesses. The company has its IPO in 2003 and since then has made several acquisitions which include Travelfusion and ToursForFun. As Ctrip proceeds to buy out Skyscanner, this will be its first step moving into the global meta-search territory. This move follows the Chief Strategy Officer of Ctrip, Jenny Wu’s declarations of globalization on stage at Phocuswright last week.

Furthermore, the deal would “strengthen long-term growth drivers for both companies,” said James Jianzhang Liang, the co-founder and Executive Chairman of Ctrip. “Skyscanner will also complement our positioning at a global scale and Ctrip will leverage our experience, technology and booking capabilities to Skyscanner’s,” he added.

The co-founder and chief executive Gareth Williams also commented on the deal, saying that “Ctrip and Skyscanner share a common view – that organizing travel has a long way to go to being solved. To do so requires powerful technology and a traveler first approach.”

On an elaborative note, Skyscanner, which has built out a strong global business, was the last remaining global meta-search without a big travel parent. Trivago, which filed for IPO last week, is under Expedia while KAYAK is part of the Priceline group.

Henceforth, this will be Ctrip’s first play into the meta-search space outside China. The company bought and now owns Qunar, which started out as a meta-search and has now morphed into meta-search-plus. This partnership will give Ctrip access to global customers at the upper funnel of search while providing Skyscanner access to the massive Chinese market.

Following this announcement, Ctrip’s shares went up 9.2 per cent at US$44.75 in extended trading.

For more information, please visit https://www.skyscanner.net/

By Vivian Foo, Unicorn Media

Starbreeze Acquires Nozon, A Belgian Visual Effects Studio And PresenZ Technology Creator To Improve VR Cinematic Experience

With the future of VR unfolding at the moment, many have clearly seen the use of the technology playing out on gaming computers and home consoles. Starbreeze, a company based in Stockholm, Sweden similarly sees the potential of VR. But instead of going for 3D game engines like most companies, the startup has, on the other hand, decided to pursue what fits into their mode of production – that is taking VR on a high-end headset, designed for amusement parks and IMAX theaters, in what known today as the StarVR headset.

Consolidating the company’s status in the VR scene, this week the company has made some major new acquisition – announcing last Tuesday that it has purchased Nozon, a Belgium-based visual effects studio for 7.1 MEUR, which roughly translates to about US$7.78 million. The deal was closed with 4.6 MEUR (approximately US$5.05 million) in cash with the remaining 2.5 MEUR as newly issued Starbreeze B-shares, worth about US$ 2.74 million. Additionally, both parties have also agreed on a capped ten-year earn out for Nozon founders based on PresenZ future financial performance.

Looking at Nozon, it is a VFX and 3D animation company that produces feature films, where among some of the company’s portfolios include animated feature films such as Asterix, the Mansion of Gods, and Minuscule which has won the César for Best Animated Movie in 2015. Yet essentially, the company’s emphasis is on developing VR cinematic using an in-house tool, PresenZ which was the tool that ultimately led to this partnership between Starbreeze and Nozon.

Introduced in 2015, PresenZ is a revolutionary technology, known for its function to be able to deliver high-quality blockbuster computer graphics (CG). Its main feature, however, lies in its ability to create an interactive parallax in virtual reality which allows viewers to move their heads with a six degrees of freedom in a pre-rendered animated video. Essentially, it enables a degree of positional tracking and when being in a movie scene. In other words, the tool facilitates a better immersion experience. Just imagine looking down the rabbit hole with Alice in Wonderland.

“PresenZ technology for multiple virtual reality applications will allow for room scale scanning and virtualization, and high-quality computer graphics rendering at an almost movie-level polygon count. The technology’s parallax capabilities will greatly complement the high fidelity of the StarVR HMD with its 210-degree field of view,” said Bo Andersson Klint, the CEO of Starbreeze.

Besides that, Starbreeze‘s immersive virtual reality cinematic experiences are scheduled to be out later in the year. As the company has already partnered with IMAX to deliver new cinematic video content to location-based pods in movie theaters and shopping malls. On the same vein, with Facebook announcing its VR social networking experience last month and EXA Global, the first VR theme park in Southeast Asia slated to launch early next year, the world is becoming lively with virtual reality and its endless possibilities.

“The future of VR is undefined but it is easy to imagine with this technology, where a space can be scanned and rendered in high-quality CGI. And with Nozon joining Starbreeze family, it is possible to imagine with the applications it houses that you could render a space like the Louvre in Paris or Saint Mark’s Basilica in Venice, and provide interactive guided tours.” the CEO of Starbreeze further adds.

For more information, please visit http://www.starbreeze.com/

By Vivian Foo, Unicorn Media

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