The Straits Times / The Business Times News on AsiaPharm

Templeton buys into AsiaPharm

Placement of new and vendor shares launched last week

US FUND group Templeton has bought into yet another China-based company - AsiaPharm Group.

A pharmaceutical group which targets the ageing population in China, AsiaPharm last week launched a placement of new and vendor shares.

Templeton Strategic Emerging Market Fund II (TSEMF II) has subscribed for 20 million of 80 million new AsiaPharm shares at 80.32 cents, giving it 4.11 per cent of the company's enlarged capital, said AsiaPharm yesterday in a filing with the Singapore Exchange (SGX).

Last year, Templeton invested in Celestial Nutrifoods, a soya bean-based food and beverage products manufacturer in China, and People Food Holdings, a frozen meat distributor.

AsiaPharm, the largest pharmaceutical company listed on SGX, had placed out the 80 million new shares to raise $64.3 million and 35 million vendor shares on May 4.

Yesterday, AsiaPharm shares ended two cents lower at 93 cents.

TSEMF II is managed by Templeton Asset Management Ltd and headed by Mark Mobius whose investment team managed over US$27 billion in assets as at March 31, 2006.

Of the 35 million vendor shares, also at 80.32 cents apiece, 20 million are from Asia Pharm Holdings, and five million each are from executive chairman Liu Dianbo, director Yuan Huixian and Su Kajia, wife of director Yang Rongbing. The sale of these shares will raise $28.1 million for their owners.

AsiaPharm said that OCBC Securities has been appointed to place out to institutional investors the remaining 60 million new shares and the vendor shares.

When completed, the company's share base will rise to 487.77 million shares of two US cents par from 407.77 million shares. Proceeds from the sale of the new shares, the first by AsiaPharm since it was listed in May 2004, will be used to fund expansion of business through mergers and acquisitions and joint ventures, the company said.

Mr Liu said: 'The inclusion of renowned institutions such as Templeton amongst our list of shareholders will undoubtedly enhance our corporate profile.' Institutional support for the placement exercise will help the group become an international pharmaceutical group, he said.