FAST NEWS: Livzon Pharma plans spinoff for reagent business

The latest: Livzon Pharmaceutical Group Inc. (1513.HK) announced on Friday it plans to spin off its Livzon Diagnostics unit, a diagnostic reagent and equipment manufacturer in which it holds a 39.43% stake, for a separate listing on the National Equities Exchange and Quotations (NEEQ) market in Beijing.

Looking up: The company said the proposed spinoff and separate listing won’t have a substantial impact on its other business segments.

Take Note: The NEEQ market is not actively traded. In the past few years, many companies have voluntarily delisted from the exchange due to low trading volumes, and transferred to other markets with higher volumes.

Digging Deeper: Founded in 1985 and listed in Hong Kong in 2014, Livzon is an integrated pharmaceutical company engaged in development and production of pharmaceutical products, including active pharmaceutical ingredients and intermediates, as well as diagnostic reagents and equipment. Chemical drug preparations account for more than half of its revenue. The company’s revenue and profit have risen steadily over the past few years, with last year’s net profit reaching 1.91 billion yuan ($266 million), up nearly 50% from 2019, the last year before the Covid pandemic.

Market Reaction: Livzon’s shares fluctuated slightly in Monday trade, closing unchanged at HK$23.45 by the midday break, near the lower end of their 52-week range.

Translation by A. Au

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