Fangda advised InnoCare Pharma Limited (stock code: 688428, “InnoCare”) on its successful listing on the Shanghai Stock Exchange’s STAR Market on 21 September, 2022. InnoCare issued 264,648,217 shares, raising a total of about RMB2.9 billion.
Previously in March 2020, InnoCare had listed on the Hong Kong Stock Exchange. The listing on the SSE STAR market marks this overseas-listed red-chip company’s successful listing and trading in Hong Kong and in Chinese mainland.
- InnoCare is an innovative biopharmaceutical enterprise powered by its groundbreaking independent research and development capabilities. The company possesses comprehensive R&D and commercialization capabilities, focuses on developing drugs for the treatment of cancer and autoimmune diseases, and is committed to developing best-in-class and/or first-in-class drugs with breakthrough potentials across global markets. One of its main products, BTK inhibitor Orelabrutinib, was approved (with conditions) by the National Medical Products Administration for commercialization in December 2020, and another, Tafasitamab, has been approved for use in Bo’ao Super Hospital as an imported drug for use in clinical urgency. The company has more than 10 other products that are in Phase I/II/III clinical trials and pre-clinical stages.
- InnoCare was co-founded by Dr. Jisong Cui and Dr. Yigong Shi. The management team comprises seasoned industry executives from multinational pharmaceutical companies, bringing InnoCare with their valuable insight in drug R&D, production and commercialization.
Fangda advised Hi-trend Technology (Shanghai) Co., Ltd. (stock code: 688391, “Hi-trend Technology”) on its successful listing on the STAR Market of the Shanghai Stock Exchange on September 13, 2022. Hi-trend Technology issued 14.4 million shares, raising a total of about RMB165.6 million.
- Hi-Trend Technology is a leading high-tech enterprise which designs, develops and sells smart metering integrated circuits in China. With its high performance, high reliability and energy-efficient products, the company has obtained a comprehensive product line and leading market position in the domestic Internet-of-Things (IOT) smart metering chip field.
- Hi-Trend Technology’s various products rank highly in both the domestic and export markets. Its “three-phase metering chips” are consistently the best seller in the domestic market, while its “single phase System on Chip (SoC) chips” achieve higher exports than others. The company’s “single phase metering chips and “smart metering Microcontroller Unit (MCU) chips” rank second in the Chinese market. The “high speed carrier communication chips” supported by the company’s core design have obtained the first batch of approval by the China State Grid with official chip-level interconnection inspection report, leading to this chip gaining promising market share in the State Grid market and being the most popular in the Chinese integrated circuit market.
Fangda advised the sole sponsor and underwriters on the Hong Kong Stock Exchange H-share listing of Chongqing Hongjiu Fruit Co. Limited (Stock code: 06689.HK) on September 5, 2022. The listing of approximatly14 million H-shares raised the net amount of around HK$496.8 million after deducting issuance fees and other expenses (assuming no over-allotment option is exercised) , making Hongjiu Fruit the first Chinese mainland fruit company to be listed on the Main Board of the Hong Kong Stock Exchange. In advance of the listing, Hongjiu Fruit converted its 296,516,495 domestic unlisted shares into H-shares.
- Hongjiu Fruit is a fast-growing multibrand fruit company in China sourcing its fruits mainly from China, Thailand and Vietnam with an end-to-end supply chain.
- Hongjiu Fruit focuses on developing fruit products in categories that enjoyed fast-growing market share and high consumption values in China. By sales revenue in 2021 according to CIC, it is China’s largest Southeast Asian fruit supplier, the largest durian distributor, as well as one of the top five distributors of dragon fruit, mangosteen and longan. Hongjiu Fruit is continuing its growth and expansion of its fruit business, as well as consolidating its market position and share in China’s fresh fruit sector.
Fangda represented the consortium of Wise Road Capital and JAC Capital in the restructuring and follow-on equity transfer of the Tsinghua Unigroup, which was completed and announced on July 11, 2022. The restructuring involved the exiting of two former shareholders, Tsinghua Holdings Co., Ltd. and Beijing Jiankun Investment Co., Ltd., and appointment of new directors, supervisors and general managers. The consortium of Wise Road and JAC, as strategic investors, have establishing a holding company, Beijing Zhiguangxin Holdings Ltd., to own all of the shares in Tsinghua Unigroup. Tsinghua Unigroup is a large Chinese integrated circuit leading company, which also acts as industry leader in mobile phone circuit design and cloud network equipment and services. Its subsidiaries include listed companies such as Unisplendour Corporation Limited and Unigroup Guoxin Microelectronics Co., Ltd. The restructuring of Tsinghua Unigroup is one of the most high-profile restructuring cases in China.
The Wise Road and JAC consortium is initiated by Wise Road Capital and Beijing Jianguang Asset Management Co. Ltd. (JAC Capital), which includes both state-owned and private capital. The restructuring and change of ownership will boost Tsinghua Unigroup’s competitiveness as a leading in China’s integrated circuit market.
Fangda Partners advised the Wise Road and JAC consortium in the restructuring and follow-on equity transfer, bringing together leading practitioners from the firm’s corporate, capital markets, insolvency and banking practices. The team advised on all aspects of the transaction, including due diligence, investment agreement and structuring, restructuring, and listed company regulation.
Fangda’s Beijing and Shanghai offices collaborated seamlessly in this project to provide clients with one-stop legal services. The Fangda team was co-led by capital markets partners WU Dong and LIU Lu and insolvency partners LI Kai and CHEN Guanbing. Other partners included Rock Wang and WANG Lingqi. The team members included LIU Yang, Albert ZHU, HOU Quan, Harry XU, Jason ZHAO, SUN Lunwen, HONG Qianwen, CAO Nan, Elizabeth SUN and FU Yeli.
Fangda represented Asian Infrastructure Investment Bank (AIIB) on its RMB1.5 billion 3-year sustainable development bond offering on China’s interbank bond market, which was closed on May 26, 2022.
The bonds were issued under AIIB’s Sustainable Development Bond Framework and represent a landmark in China’s sustainable development bond market for being:
- the first sustainable development bond issuance in China by a supranational issuer
- the first sustainable development bond issuance in China conducted under the issuer’s sustainable development bond framework
- the first sustainable development bond issuance by an international development institution under the pilot program for social bonds and sustainability bonds launched by the National Association of Financial Market Institutional Investors (NAFMII) of China
Fangda acts as the counsel to Zoomlion Heavy Industry Science and Technology Co., Ltd. ("Zoomlion", a dual-listed company, A-share stock code: 000157.SZ, H-share stock code: 01157) in its acquisition of the controlling stake in ShenZhen RoadRover Technology Co., Ltd. ("RoadRover Technology", stock code: 002813.SZ), becoming its controlling shareholder.
The transaction was notable as a typical deal involving an A share-listed company acquiring a controlling stake in another A share-listed company. The acquisition was completed through a negotiated private transfer following with a tender offer.
Upon completion, Zoomlion holds 48.82% of shares in RoadRover Technology, which was achieved with the following two steps:
- acquisition of 29.99% of shares through the negotiated private transfer, completed on February 23, 2022, making Zoomlion a controlling shareholder of RoadRover Technology; and
- tender offer for an additional 23.83% of RoadRover Technology, completed on May 9, 2022.
Huaxin Cement Co., Ltd. (“Huaxin Cement”) is a comprehensive building material enterprise engaged in the production and sale of cement, clinker, concrete and aggregate, and operating businesses of environmental protection, equipment manufacturing, EPC engineering and cement-based new building materials. Huaxin Cement has over a century of doing business in the PRC and has been a public company listed on the Shanghai Stock Exchange since 1994.
The listing of the H shares of Huaxin Cement (Stock code: 6655.HK and 600801.SH) on the Main Board of The Stock Exchange of Hong Kong Limited on March 28, 2022 was by way of introduction and the change of listing venue of the B shares of Huaxin Cement from the Shanghai Stock Exchange to Hong Kong Stock Exchange, and was the first deal of its kind from Shanghai. Complexities of the transaction included the involvement of a cash option offered to all B shareholders Huaxin Cement and for Holcim Limited, the controlling shareholder of Huaxin Cement, to sell down some of its B shares by way of a private placement to ensure that the public float of H shares immediately upon listing meets the required 15% threshold.
The listing of the H shares of Huaxin Cement on March 28, 2022 consisted of approximately 734.7 million H shares opening at a price of HK$14.74 per H share. Huaxin Cement also has 1,361.9 million A shares on the Shanghai Stock Exchange which opened at a price of RMB17.83 on the same date.
Fangda acted as Hong Kong counsel to the sole sponsor, Shenwan Hongyuan Capital (H.K.) Limited. The Fangda team was led by partners Peter Chen and Arman Lie, and the team members comprised Jonathan Wallenberger, Brian Kwok, Tracy Ho, Loy Chen, Lizzie Cheong, Jennifer Chen, Ivy Chung, Andrew Chan, Lizzie Cheong and John Cheung.
Jinmao Property Services Co., Limited ("Jinmao Services") is part of China Jinmao Holdings Group Limited (“China Jinmao”), a subsidiary of Sinochem Holdings Corporation Ltd., a Fortune 500 company. Jinmao Services is a fast-growing upscale property management and city operation service provider in China, and provides property management services, value-added services to non-property owners and community value-added services.
The listing of the ordinary shares of Jinmao Services (Stock code: 00816) on the Main Board of The Stock Exchange of Hong Kong Limited and the closing of the global offering took place on March 10, 2022, making Jinmao Services the first successful Hong Kong property sector IPO in 2022. The global offering consisted of approximately 101.4 million shares (prior to the exercise of the over-allotment option) valued at the high-end of the offer price range of HK$8.14 per share, for a total offering of approximately HK$825 million. If the over-allotment is fully exercised, the total offering will amount to approximately HK$949 million. In addition to the global offering of 101.4 million shares of Jinmao Services (prior to the exercise of the over-allotment option), the offering also involves distribution by China Jinmao (Stock code: 00817), the controlling shareholder of Jinmao Services, of approximately 191 million shares of Jinmao Services (the "Distribution") to eligible shareholders of China Jinmao. The global offering also consisted of an offer size adjustment option and distribution adjustment to provide flexibility for adjustments to the global offering and the Distribution, respectively.
Fangda acted as Hong Kong and US counsel to CICC and HSBC as joint sponsors of the listing, together with CLSA Limited and Essence International as joint global coordinators, and other members of the underwriting syndicate including ABCI, CCB International, CMB International, Huarong International , Huatai, Shenwan Hongyuan and Livermore.
The Fangda Hong Kong and US team was led by partners Colin Law, Christine Chen, Edward Bong, and Lawrence Wang, and the team members comprised of Jonathan Wallenberger, Ding Hong, Eric Li, Tracy Ho, Jennifer Chen , Jennifer Mok, Lizzie Cheong and Krystal Dong.
Fangda represented KIRIN HOLDINGS COMPANY, LIMITED (“Kirin”) in the sale of its entire 40% stake in its joint venture with China Resources for approximately US$1 billion. The share purchase agreement was signed and the deal was announced on February 16, 2022. The deal is significant as being one of the most important transactions in the FMCG and food and beverage sectors in recent years. It is also a typical case of foreign capital exiting from previously PRC state- and privately owned joint ventures.
Kirin is a Japanese beverage industry giant and a listed company on the Tokyo Stock Exchange.
The Fangda team was led by partner Haiping Sun, and the team members included counsels Chen Lu and Xiaote Jin and associates Echo Qin, Elisa Liu, Bingyan Xu, and Jinjin Lu. Fangda acted as Kirin's legal counsel in the transaction, being fully capable of communicating in Chinese, Japanese and English. Fangda led the drafting and negotiation of all transaction documents, design and analysis of deal structure and provided professional advice on intellectual property licensing and other aspects related to the transaction.
Fangda’s Japanese practice team focuses on handling various legal issues involved in investment and trade between Chinese and Japanese companies. We have abundant experience in China-Japan legal services, including Chinese companies’ investment activities or disputes in Japan and advising from a PRC legal perspective on Japanese companies’ local or Chinese-related transactions. With comprehensive coverage of practice areas, exceptional legal skills, as well as collaboration with Japanese lawyers, we can provide comprehensive one-stop legal services in Chinese, Japanese and English to clients.
On February 8, 2022, the Shanghai Pudong New Area People’s Court ruled to accept the bankruptcy and restructuring case of Shanghai Shengnan Industrial Development Co., Ltd. (“Shengnan Industrial”) and appointed Fangda as the administrator on February 17, 2022, following the request of the bankruptcy applicant. This is a groundbreaking case:
- The first bankruptcy and restructuring case under new legislation in which the court appointed the administrator according to the request of the applicant.
- The first bankruptcy and restructuring case handled by the Bankruptcy Adjudication Tribunal of the Shanghai Pudong New Area People’s Court since its official launch on January 7, 2022.
Fangda represented Hungary on its RMB1 billion 3-year green panda bond offering, which was closed on December 16, 2021. This is another milestone in the development of China’s green bond market, unfolding a new era for panda bonds.
This transaction is
- the first green sovereign panda bond offering in the market;
- the first green bond offering on China’s debt market under the issuer’s Green Bond Framework established on the basis of the Green Bond Principles published by the International Capital Markets Association (ICMA), with use of proceeds meeting China’s Green Bond Endorsed Projects Catalogue (2021 Edition); and
- the first green sovereign bond offering under the pilot program for social bonds and sustainability bonds launched by the National Association of Financial Market Institutional Investors of China in November 2021.
Today, BeiGene listed on the Shanghai Stock Exchange’s STAR Market, becoming the first biotech company in the world to have shares traded in Chinese mainland, in Hong Kong and on the Nasdaq Board in the U.S. The registration for listing was granted by the China Securities Regulatory Commission on 16 November, 2021.
Fangda Partners advised BeiGene throughout on its US$3.5 billion (before over-allotment option is fully exercised) initial public offering and listing on the STAR Market. Our advice covered everything from legal issues relating to red-chip companies deciding to re-list on China’s stock exchanges, corporate governance, communications with regulators and close coordination with cross-border intermediaries. The listing involved following rules on corporate governance and securities supervision in several countries and regions, as well as ensuring compliance with listing rules in the three markets.
Since the commencement of the STAR Market in 2019, there have been three stages involving the transition of red-chip companies to having their shares listed as A-shares. In the first stage was the listing of companies (such as China Resources Microelectronics Limited and Ninebot Limited) that are not listed overseas when submitting their A-share listing applications. The second stage involved the listing of companies (such as Semiconductor Manufacturing International Corporation) that are listed in Hong Kong. And in this, the third stage, companies already listed in the U.S. and Hong Kong can now have their shares listed on the STAR Market.
Fangda has been deeply involved in all the representative listings in these three stages. Our work on the first-ever triple listing of a biotech company on the NASDAQ, HKEx and STAR Market is a reflection of our expertise in all the key legal issues related to multimarket-listed red-chip companies’ listing on the STAR Market and ability to understand the requirements of regulators. Fangda is therefore ideally positioned to advise on the return of other red-chip companies listed on overseas exchanges.
The Fangda team was led by partners Jeffrey Ding and Yvette Liu and supported by associates Yuan Fang, Travis Xu, Cassie Chang, Shirley Li and Lu He.
Dalian Shipbuilding Industry Offshore (DSIC Offshore), a subsidiary of Dalian Shipbuilding Industry Co., Ltd (DSIC), has completed a successful restructuring by way of an RMB1.78 billion insurance claim payout from China Export & Credit Insurance Corporation (CECIC). This is the first time in China that a non-listed company has been restructured via an insurance claim rather than from an injection of new capital.
DSIC Offshore, which specialises in the manufacturing of oil rigs, oil production platforms, drill ships, FPSOs and wind turbine installation vessels, as well as other fixed and floating drilling or oil and gas production facilities, was severely impacted due to the plunge in oil prices in 2015. The company had run up debts of up to RMB20 billion, which included wages owed by more than 6,000 migrant workers.
DSIC Offshore went into administration on 23 January 2019. Fangda Partners and Baker Tilly China were designated as the administrator for DSIC Offshore.
DSIC Offshore was not able to raise the finance to pay off the debt by conventional means. There were no investors and even the parent company, DSIC, was not able to inject capital. DSIC Offshore’s insurance policy covered the risk of order cancellations, but the likelihood was that would it take too long to process these claims.
Facing such an impasse, the Fangda team ventured an unprecedented solution that brought CECIC to the negotiation table and secured a whole package of insurance claims amounting to RMB1.78 billion. To date, this is the highest insurance claim in China’s offshore manufacturing sector.
The solution lay in the fact that the Fangda team is well-versed in the latest policies and market trends that CECIC, as a policy-oriented insurance company, is expected to shoulder a big responsibility in assisting China’s export-oriented manufacturing enterprises, especially during the pandemic. Following the restructuring, DSIC Offshore is back as a going concern with a bright future.
The Fangda team was led by partners Nuo Ji and Kai Li and included counsel Sylvia Zhang.
On November 15, 2021, Nanjing Vazyme Biotech Co., Ltd. (stock code: 688105, “Vazyme”) successfully listed on the STAR Market of the Shanghai Stock Exchange. Vazyme issued a total of 40.01 million shares, raising a total of about RMB2.2 billion. Vazyme is the first biological reagent company to be listed on the SSE STAR Market.
Vazyme researches and develops technology and products focusing on functional proteins, such as enzymes, antigens, antibodies, and polymer organic materials. It is regarded as one of the few domestic R&D innovative enterprises that have capabilities of both independent and controllable upstream technology development and terminal product production in China.
Vazyme owns more than 200 types of genetic engineering recombinant enzyme and 1,000 high-performance antigens and monoclonal antibodies. In addition, the company owns more than 500 products that are widely applied to science research, high-throughput sequencing, in vitro diagnosis (IVD), pharmaceutical and vaccine research development, animal quarantine and other fields.
After the outbreak of the COVID-19 epidemic, Vazyme helped in the drive to limit the global spread of the disease through developing detection kits and neutralizing antibody drugs, among other biological breakthroughs.
Fangda acted as the legal counsel to the sole sponsor and lead underwriter, Huatai United Securities, and participated in the whole process of Vazyme’s SSE STAR Market issuance and listing. The team was led by partners Qiang Ma and Wanhua Huo, and team members included Kevin Liu, Shirley Feng, Xinyu Guo, Haiying Wang, and Anna Wu.
On March 3, 2020, the Shanghai Third Intermediate People's Court issued a ruling to accept the bankruptcy restructuring case of Shanghai Yuehe Real Estate Co., Ltd. ("Yuehe Real Estate") and appointed Fangda as the administrator.
Yuehe Real Estate is the developer of the Yuehe International Plaza. The total construction area of the project is 219,082 square meters. Since its shutdown in 2014, this is one of Shanghai’s largest unfinished building projects. The project debt exceeds RMB12 billion, and there are more than 700 creditors of whom nearly 400 are small owners. Many were put at a distinct disadvantage as a result of losing rights to claims against the debtor before the bankruptcy was submitted to the court.
During the restructuring, under the guidance of the Shanghai No. 3 Intermediate People's Court and with the support of applicable government departments, Fangda, as the administrator, proposed a plan for restructuring which involved Yuehe Real Estate issuing a debt of common interest (as defined in China’s Enterprise Bankruptcy Law) which was put out to public tender. Shanghai Green Court Investment Holdings Co., Ltd. was selected as the new investor in the project in order that construction could continue. The restructuring plan was approved by a creditors’ meeting and then approved by the Shanghai Third Intermediate Court on July 1, 2021.
Approval for construction to restart on the Yuehe International Plaza was given on September 18, 2021 and there was an official ceremony to resume the project on September 29. Representatives of the administrators, investors and property owners gave speeches to mark the resumption of the project.
At the end of October, a second restructuring investment fund was successfully raised.
The use of the common interest debt in a restructuring case involving unfinished construction is rare and could set a useful precedent for other similar projects as China undergoes a continuing downturn in its real estate market .
In the administration, our partner Nuo Ji acted as the general coordinator, partner Kai Li acted as the team leader of bankruptcy team, partner Guanbing Chen acted as the executive leader, and real estate team partners Stephen Lin and Xinjie Yuan provided professional legal support. Team members also included counsel Deyuan Kou, and associates Guangze Tu, and Lanxin Zhu.
Fangda recently advised on the successful restructurings of Bestway Marine & Energy Technology Co., Ltd. and Dalian Shipbuilding Industry Offshore Co., Ltd.
Fangda has extensive practical experience in bankruptcy and restructuring and is renowned for handling large and complex bankruptcy projects. Our bankruptcy and liquidation lawyers often work closely with our lawyers in banking, capital markets, M&A, real estate, labor, intellectual property, and dispute resolution to deliver comprehensive legal solutions for our clients. Fangda is the first-level administrator of the Shanghai Higher People's Court and the out-of-province administrator of the Zhejiang Higher People's Court.
Fangda Partners acted as the underwriters’ Chinese counsel on the RMB2.2 billion bond issue by the Guangdong provincial government in the Macao Special Administrative Region of the People's Republic of China (“MSAR"). This is the first offshore bond issued by a Mainland municipal government in the Guangdong-Hong Kong-Macao Greater Bay Area.
This issuance is also the first Mainland municipal government offshore bond issuance since the Ministry of Finance promulgated the Administrative Measures for Local Government Bond Issuance in December 2020.
The bond was issued to domestic and foreign investors (through the S rule, bookkeeping file issuance), with a coupon of 2.68% per year.
Fangda Partners acted as the underwriters’ Chinese legal counsel in the bond issuance, providing the legal opinion and advising on all PRC legal aspects of the transaction. The team was led by partner Lu Liu in our Capital Markets Group.
Fangda has advised JP Morgan to set up China’s first wholly foreign-owned securities company. On August 6, 2021, JPMorgan announced that the China Securities Regulatory Commission (CSRC) had approved its application to be the sole controlling shareholder of JPMorgan Chase Securities (China) Co., Ltd.
Fangda Partners acted as the legal counsel to JPMorgan Chase and participated in the whole process from the establishment of the securities company to effecting the transfer of shares from five domestic shareholders to JP Morgan. The team was led by partner Zhiyi Ren.
Fangda represented MBK Partners in its acquisition and privatization of CAR Inc. (“CAR”, HK Stock Code：00699), the largest car rental company in China.
MBK Partners firstly acquired an approximately 20.9% stake in CAR, and then acquired the remaining outstanding shares of CAR through a voluntary general offer and compulsory acquisition for a total consideration of approximately USD 1.1 billion. Such compulsory acquisition was completed on July 5, 2021, and CAR was delisted from the Stock Exchange of Hong Kong and became a wholly-owned subsidiary of MBK Partners on July 8, 2021.
Founded in 2005, MBK Partners is one of the largest private equity funds in Asia with over US$24 billion of capital under management. MBK Partners focuses on North Asia and has developed expertise in various industries, including consumer and retail, telecommunications and media, financial services, healthcare, logistics and industrials. The aggregate revenues of MBK Partners’ 38 portfolio companies exceed US$47.2 billion.
Fangda team was led by corporate partners Jeffry Ding, Patrick Li, banking partner Rock Wang, and antitrust partner Michael Han. Fangda team handled the PRC legal due diligence, transaction structure discussion and the review of transaction documents.
On June 28, 2021, the Beijing No.1 Intermediate People’s Court approved the Restructuring Plan of Peking University Founder Group Co., Ltd. (the “Founder Group”) and other four companies. The Founder Group was once the largest university-run enterprise in China, and the bankruptcy restructuring of Founder Group is one of the most complicated bankruptcy restructuring cases in China.
Shenchao Technology Investment Co., a wholly-owned subsidiary of Shenzhen Major Industrial Investment Group, acted as a co-investor in the Founder Group and on its acquisition of all equity previously held by the Founder Group in Founder Microelectronics in the bankruptcy restructuring of the Founder Group.
Shenzhen Major Industrial Investment Group is an investment platform for leading industries owned by the Shenzhen municipal government. Its investments focus on major industries such as integrated circuits, with the aim of empowering breakthrough technologies. Founder Microelectronics is a national high-tech enterprise engaged in the manufacturing of integrated circuit chips. It has the first 6-inch device production line in China, with business implantation of its 13 silicon carbide product series, which leaps into the front rank of the 6-inch production line in China.
Fangda’s Shenzhen and Guangzhou offices in the Greater Bay Area worked closely together to advise Shenchao Technology on all aspects of the transaction. The Fangda team is led by corporate partner Qiang Ma and dispute resolution partner Ivan Su, and the core members include Shirley Feng, Terry Ling, Kevin Liu and Jiaqi Wen.
Fangda Partners acted as the PRC counsel to the New York Stock Exchange-listed company XPeng Inc. (“XPeng”) on its global offering of 85 million Class A ordinary shares (including an international placement and Hong Kong initial public offering), marking XPeng’s dual primary listing on both the New York Stock Exchange and Hong Kong Stock Exchange. The deal raised gross proceeds of approximately HK$14 billion (approximately US$1.8 billion), and will raise approximately US$2.1 billion in total if the over-allotment option is fully exercised. The listing and global offering was closed on July 7, 2021.
XPeng is one of China's leading smart electric vehicle companies. According to data from IHS Markit, XPeng is currently the only Chinese automobile company that independently develops full-stack autonomous driving technology software and applies the software to its mass-produced vehicles. XPILOT 3.0, the latest self-developed autonomous driving system developed by XPeng, is one of the most advanced autonomous driving technologies used in cars currently sold on the market.
After advising on XPeng’s successful listing on the New York Stock Exchange in 2020 and subsequent additional issuances, Fangda has continued to act as XPeng’s PRC legal counsel in this deal. The team advising on this transaction was led by partners Jeffrey Ding, Tianyi Chen and Patrick Li and counsel Jianbo Wei. They were supported by team members including Cassie Chang, Wei Feng, Charlene He, Hale Lu in our Beijing office, and Xinyu Guo, Yinglin Kong and Muyuan Zhang in our Shenzhen office.
Fangda acted as Hong Kong and US counsel to Chaoju Eye Care Holdings Limited (Stock code: 2219) on the listing of Chaoju Eye Care’s ordinary shares on the Main Board of the Stock Exchange of Hong Kong and the concurrent global offering. The listing and global offering raised approximately HK$1.81 billion (prior to exercise of the underwriters’ over-allotment option).
Chaoju Eye Care is a leading ophthalmic medical service group in North China with a strong reputation nationwide. Since the inception, Chaoju Eye Care has adhered to the vision of "taking our century’s heritage to bring light to the world and inspire hope" and provided patients with safe, reassuring and affordable ophthalmic medical experience with professional and effective equipment and technology as well as caring and considerate services.
The listing and the closing of the global offering took place on July 7, 2021. Haitong and Huatai acted as joint sponsors of the listing, as well as joint global coordinators, joint bookrunners and joint lead managers of the global offering.
The Fangda team was led by partners Peter Chen, Christine Chen and Arman Lie and the team members comprised of associates Brian Kwok, Siyu You, Ning Linzy, trainee Lizzie Cheong and paralegal Andrew Chan.
Fangda advised Zhejiang Cangnan Instrument Group Co., Ltd. ("Cangnan Instrument", stock code: 1743.HK) on its privatization through general offer by way of buy-back of all issued H-shares. Cangnan Instrument were officially delisted from the Hong Kong Stock Exchange at 9 a.m., July 5, 2021.
Cangnan Instrument’s unprecedented privatization offer by way of a share buy-back was the first-ever privatization transaction structure using such a mechanism on the main board of Hong Kong Stock Exchange. This innovative structure provides more flexibility for companies that intend to delist (for example, for listed companies with relatively dispersed shareholding structures) as an alternative privatization mechanism to shareholder general offers or schemes of arrangement. At the shareholders’ meetings of Cangnan Instrument in May, the privatization transaction was unanimously approved by the participating shareholders, and the offer acceptance rate of the H-share shareholders was almost 100% - indicating the value of this privatization mechanism, which is set to establish a precedent in the Hong Kong market.
Cangnan Instrument is a leading Chinese company specializing in the manufacture and sale of a variety of industrial and commercial gas flow meters, as well as having R&D, manufacturing, sales and after-sales service divisions. The delisting from H-share market will help the company save regulatory and compliance costs, increase its flexibility and efficiency in future business development, and enhance its core business development capabilities and competitiveness.
Fangda’s Hong Kong Capital Markets team acted as the Hong Kong legal counsel of Cangnan Instrument (the offeror) in this transaction, utilizing the firm’s leading strength in the privatization of Hong Kong-listed companies and synergistic cross-office advantages. In the transaction, we provided a full range of services, including: taking the lead in the design of the transaction structure; acting as the main contact party to communicate and liaise with the Hong Kong regulators including Securities and Futures Commission and the Hong Kong Stock Exchange; drafting and finalizing transaction documents; and assisting in transaction funding arrangements. The Fangda team was led by partners Peter Chen and Lawrence Wang. Partner Laurence Yuan provided support on transaction funds. Team members included Brian Kwok and Andrew Chan.
On September 25, 2020, the China Securities Regulatory Commission (“CSRC”), the People's Bank of China and the State Administration of Foreign Exchange issued the Administrative Measures for Securities and Futures Investment Operated in China by Qualified Foreign Institutional Investors and RMB Qualified Foreign Institutional Investors. On the same day, the CSRC issued the Provisions on Issues concerning the Implementation of the Administrative Measures for Securities and Futures Investment Operated in China by Qualified Foreign Institutional Investors and RMB Qualified Foreign Institutional Investors. These regulations have made major adjustments to the application requirements and investment scope of qualified foreign institutional investors (QFII) and RMB qualified foreign institutional investors (RQFII). The rules were both implemented on November 1, 2020.
On May 14, 2021, Blackstone Alternative Solutions L.L.C. was recognized as a qualified foreign institutional investor (QFII). It was among the first batch of US-funded institutions to obtain qualified foreign institutional investor (QFII) recognition since the new regulations were implemented in 2020.
Fangda Partners advised Blackstone on its qualification application, including application materials review, legal compliance advice, and supplier agreements’ verification. The Fangda team was led by the investment management team partner Zhiyi Ren and the investment fund team partners Richard Guo and Candy Tang.
Fangda represented Ping An Life Insurance Company of China on its acquisition of an equity stake in China Raffles Group from CapitaLand. The property portfolio includes Raffles City Shanghai, Raffles City Beijing, Raffles City Ningbo, Raffles City Chengdu, Raffles City Changning (Shanghai), and Raffles City Hangzhou. Each of them is an integrated business center, comprising business offices, hotels, and other different real estate components. The total asset value of the portfolio is RMB46.7 billion, in which Ping An Life Insurance has invested about RMB33 billion. The transaction was signed and is expected to close in the third quarter of 2021. CapitaLand will continue to operate and manage the six properties.
The six underlying properties in the transaction are all part of the "Raffles" brand, CapitLand’s core property line. These properties were recognized as one of the 2020 Brands of the Year: China Most Influential Shopping Center by a Chinese award agency. The properties are located in central business districts in China’s major cities. The six properties have recorded high occupancy rates since 2019 of between 90% and 95% even during the COVID-19 pandemic. The assets are attractive to Ping An Life Insurance since they offer steady investment returns over the long term, which is fully in keeping with Ping An’s investment perspective.
Fangda handled all aspects of the transaction for Ping An, including transaction structure design, legal due diligence, transaction documentation, insurance compliance, merger control filing and closing related matters. The cross-practice, cross-office (including Shanghai, Beijing and Hong Kong) Fangda team was led by partners Maria Wang and Zhenyu Wang supported by real estate and construction partners Yingying Wang and Frank Fan, financial institution group partner FANG Jian, antitrust partners Michael Han and Jin Wang, and corporate/M&A partner Hao Zhang.
We regularly advise strategic inbound and outbound investors, international private equity sponsors, institutional investors and other investors on their cross-border acquisitions, disposals and other forms of investments, including of and in real estate assets and portfolios in Mainland China, Hong Kong SAR and offshore jurisdictions. We are familiar with complex cross-border transaction structures and common law-related concepts. Together with our superior China real estate expertise, we are renowned for our ability to act both as PRC counsel and international counsel in cross-border real estate transactions. We regularly advise on real estate transactions of values of at least RMB5 billion.
Fangda has advised a buyer consortium on its proposed take-private of leading human resource service provider 51job, Inc. (NASDAQ: JOBS). The consortium comprises DCP Capital, Ocean Link, and 51job’s chief executive officer, Rick Yan. Recruit Holdings Co., Ltd. also participated in the deal as the current shareholder. The deal was announced on June 21, 2021.
Founded in 1998, 51job is a leading provider of integrated human resource services in China. With a comprehensive suite of HR solutions, 51job meets the needs of enterprises and job seekers through the entire talent management cycle, from initial recruitment to employee retention and career development. 51job was listed on NASDAQ on 2004. Under the merger agreement, except the continuing shareholder, the buyer consortium will pay US$79.05 per common share/American Depositary Share (ADS) to acquire the remaining shares and ADSs in 51job, implying a deal value of about US$5.7 billion. 51job will be delisted from NASDAQ after the privatization.
Fangda Partners acted as PRC legal counsel to the buyer consortium, including providing due diligence, advising the buyer consortium on the financing plan and transaction agreement, and analyzing the Chinese merger control issue. The Fangda team was led by partners Leo Lou, Dalin Cong, Caroline Huang, Stanley Chen and Gil Zhang, and team members included Zichao Wu, Lena Chen, Jichao Chang, Hanzhi Jiang, Brown Lin, Huihui Li, Kaixian Zheng, Yizhu Mao, Harry Xu, and others.
Fangda has market-leading experience in advising on delisting and follow-up financing for many overseas listed companies, including: ShangPharma Corporation, Focus Media Holding Ltd, Giant Interactive Group Inc., United Family Healthcare, Wuxi AppTec Co., Ltd, Mindray Medical International Ltd, Qihoo 360 Technology Co. Ltd, Homeinns Co., Ltd, Trina Solar Co., Ltd, Bona Film Group Ltd, Aupu Group Holding Company Ltd, Intime Department Store, Yingde Gases Investment Ltd, Ak Medical Holdings Ltd, eHi Auto Services Ltd, Jumei International Holding Ltd, 58.com Inc., Haier Electronics Group Co., Ltd, Changshouhua Food Company Ltd, and China Biologic Products Holdings, Inc., among others.
On June 7, 2021, DBS Group announced that DBS Securities (China) Co., Ltd. (“DBS Securities”), its newly established securities company in China, has obtained the securities business license from the China Securities Regulatory Commission and is now authorized to operate securities brokerage businesses, securities investment consulting businesses, securities proprietary trading as well as securities underwriting and sponsorship services. The registered capital of DBS Securities is RMB1.5 billion. DBS Bank Ltd., a Singapore incorporated financial institution, is the largest controlling shareholder (holding 51% of the total equity interests). In 2007, DBS Bank established DBS Bank (China) Co., which is one of the first bank subsidiaries established by foreign banks.
Fangda has been assisting DBS Securities in the preparation of its set-up since May 2020. This is the second strategic investment project in China in which we have advised DBS Group recently. DBS Group has made a public announcement in April 2021 that the investment by DBS Bank in Shenzhen Rural Commercial Bank, making DBS the largest shareholder in the bank with 13% of the total shares, has been approved by the Monetary Authority of Singapore and the China Banking and Insurance Regulatory Commission. Fangda represented DBS Group in this transaction.
On June 10, 2021, BlackRock CCB Wealth Management Co., Ltd. held an opening ceremony in Shanghai to formally launch its business. Blackrock holds a majority (50.1%) stake in this new joint venture wealth management company. The minority equity interests are held by China Construction Bank (40%) through Jianxin Wealth Management Co., its wholly-owned wealth management subsidiary, and Temasek (9.9%).
The joint venture combines BlackRock’s advanced expertise in international asset management, investment management and risk control with CCB’s advantage in domestic customer base and distribution channels. The company aims to serve China’s fast-growing wealth and asset management sector, offering sophisticated products and services to Chinese customers and to help facilitate the development of China’s real economy. Temasek will also contribute its experience and knowledge to create long-term value for this joint venture wealth management company’s future development. Fangda has been advising BlackRock on this strategic investment project from the start. This is the second strategic investment project in China in which we have advised BlackRock recently.
BlackRock also announced on June 11, 2021 that it has obtained the approval to launch its first wholly foreign-owned fund management company. Through this fund management company, Blackrock wishes to provide Chinese investors with personalized onshore investment products and solutions, and continue to develop its business and expertise in the local market.
In addition to the above investments, as China’s financial services sector continues to open up, Fangda’s Financial Institutions Group has assisted many international financial institutions to set up companies, on their M&A deals involving domestic financial institutions, as well as helping many financial institutions to obtain various financial licenses, including commercial banking, insurance, securities, futures, funds, wealth management, private banking, and commercial payments, among others. The leading partners included FANG Jian, Grace Yu, Siyuan Pan and Ada Zou.
Fangda represented BMW Group on its RMB3.5 billion panda bond offering, priced on June 10, 2021. BMW Finance N.V., a BMW Netherlands finance company subsidiary, was the issuer, with the bonds guaranteed by its parent. The bonds comprise RMB2 billion 3-year medium-term notes (MTNs) and RMB1.5 billion 1-year commercial paper (CP). The MTNs were priced at an annual coupon rate of 3.44% and the CPs at 3.03%. The bonds were offered to institutional investors in and outside China (including through the Bond Connect regime) on China’s interbank bond market. The offering was more than three times over-subscribed with approximately half of the orders from overseas investors.
This is the first public offering of panda bonds by a European non-financial institution (non-FI) corporate, as well as the first public offering of panda bonds by an international non-FI corporate issuer under the new corporate panda bond rule adopting a tiered management regime. It is also the first public offering of guaranteed panda bonds issued by a finance company and guaranteed by its parent. BMW has previously been an active issuer of panda bonds through private placements.
Fangda, as the issuer’s counsel, drafted all the transaction documents in English and Chinese and advised BMW Group on all aspects of the transaction. The Fangda team was led by the partner Christine Chen with key members including Helen Zhao, Sophie Li and Hailey Ma. Helen Wang and Leanne Liu provided support in deal execution.
Fangda Partners advised Buhuo Venture Capital on the final closing of its Phase I US Dollar-dominated venture capital fund, which raised more than US$100 million. Buhuo’s transaction was backed by two US-based funds of funds and one Asia-based fund of funds. Two limited partnerships (LPs) from Buhuo’s Phase I RMB Fund also participated in the new fund.
Following the closing, Buhuo has become both an RMB and US dollar fund management firm. In the transaction, Buhuo transferred partial stakes in four assets from its initial RMB fund, Buhuo Ventures RMB Fund Phase I, a 2017-founded vehicle, to fund two-thirds of the US dollar fund’s assets, with the remainder being follow-on capital . Buhuo is the latest Chinese general partner (GP) using yuan-to-dollar structuring to raise capital from a more diversified LP base.
Buhuo Venture CapitaI, co-founded by Jay Li and Ray Yi in 2017 and headquartered in Beijing, invests in angel and VC start-ups, with a focus on the Chinese supply chain industry. Many of its investees, such as Zhongneng United, Guoquan, Carzone, HuiIian, Iboxpay, DoIphin Inc., Youxi Movie Hotel, Zhangshangfucai, Wanqian Fasteners, Baishunyangche, and Sharkfit, have become the leading companies in their specialist areas of operation.
Fangda’s investment fund team and corporate financing team provided (together with other firms) the full range of transaction services and legal advice to Buhuo Venture Capital in drawing up all transaction documents and negotiation of the US dollar fund formation, as well as on the yuan-to-dollar fund structuring. The Fangda team was led by investment fund partners Richard Guo and Yue Zhang, and corporate financing partners Avica Wang and Shihua Wang, and other key members included Icy Huang, Serena Zhou, Shirley Lim, Duncan Deng, Kai Wang, Alaric Zhang, and Xin Yue.
Fangda advised China Merchants Bank in an acquisition financing to facilitate the privatization Special Purpose Vehicle (SPV) set up by the shareholders and investors in China Distance Education Holdings Limited (CDEL, NYSE: DL). CDEL has de-listed as part of the go-private transaction.
China Merchants Bank provided financing to facilitate CDEL's go-private process. CDEL completed the acquisition and privatization on March 19th, 2021. Following the acquisition, CDEL de-listed from the New York Stock Exchange and trading of its American depositary shares was suspended.
Founded in 2000, CDEL is a leading provider of online education and value-added services for professionals and corporate clients in China. CDEL owns 20 websites of its subsidiary brands, and offers more than 300 professional development courses across 13 disciplines, covering accounting, healthcare, engineering & construction, legal, start-ups, elementary and high school, higher education diplomas or degrees and postgraduate entrance examination.
The go-private transaction structure, involving many buyer consortium members, financing guarantee arrangement, and loaning process included dozens of entities across multiple jurisdictions. Each stage in the process was highly complex. Fangda acted as lead PRC counsel to China Merchants Bank and coordinated all local counsel support, including local firms in Hong Kong, BVI, Cayman Islands, Seychelles and other jurisdictions. The Fangda team was led by Shanghai-based partner Rock Wang, and team members included Harry Xu, Katherine Huang, Jenny Ding and Joelle Cheng.
In one of the most influential deals in the video games industry, Fangda advised Moonton Technology on its acquisition by ByteDance's video games unit Nuverse. The deal was announced on 22nd March, 2021.
Following the acquisition, the Shanghai-based Moonton Technology will continue to operate independently. The company already has several offices in Indonesia, Singapore, and Hong Kong SAR, and is most famous in Southeast Asia for its multiplayer online battle arena (MOBA) game. Moonton Technology will provide the strategic support needed in video games, electronic sports and other areas to help ByteDance accelerate its global gaming offerings.
Fangda acted as deal counsel to Moonton Technology, advising on bidding and due diligence aspects in connection with several potential buyers, which included ByteDance, and advised on transaction negotiation and documentation, as well as providing antitrust and IP-related advice. The Fangda team was led by corporate partners Norman Zhong, Helen Fan and Raymond Chan, supported by antitrust partners Michael Han and Jin Wang, and entertainment law & IP partner Devan Shao. Other key members included Joyce Pei, Kitty Ng, Hao Zhang and other associates.
China Merchants Bank Co., Ltd. (“CMB”) has issued a public announcement on March 19, 2021, according to which,
- CMB contemplates to bring in a strategic investor JPMorgan Asset Management (Asia Pacific) Limited (“JPMAMAPL”) to increase the registered capital of CMB’s wholly owned subsidiary CMB Wealth Management Co., Ltd. (“CMB Wealth Management”) in cash;
- JPMAMAPL will make a capital contribution of around RMB2.667 billion, of which around RMB0.556 billion shall be calculated in the registered capital of CMB Wealth Management. After the capital increase, JPMAMAPL will hold 10% equity interest in CMB Wealth Management; and
- Such capital increase shall be filed with China Banking and Insurance Regulatory Commission for approval.
Fangda represented the Asian Development Bank (ADB) on its RMB2 billion panda bond offering on China’s interbank bond market, issued on March 10, 2021. It is:
- the first panda bond issued by an international development institution following the implementation of new panda bond rules for foreign governments and international development institutions at the end of 2020 in China
- ADB’s largest-ever borrowing in an Asian local currency
Fangda acted as PRC legal counsel to New Horizon Health Limited in connection with its initial public offering and listing on the Hong Kong Stock Exchange (stock code: 6606). New Horizon’s shares commenced trading on February 18, 2021, jumping 185% on its debut. New Horizon’s IPO was significantly over-subscribed, raising around HK$2 billion (assuming no over-allotment option is exercised).
New Horizon is a market leader in cancer screening, focusing on the design, development and commercialization of cancer screening tests. The company obtained the first registration approval issued by the National Medical Products Administration (NMPA) for early screening tests in November 2020.
The Fangda team was led by corporate partners Jeffrey Ding and Diana Li and IP partner Sherry Yao, and other key members included Travis Xu, Siyu Chen, Jeanette Wang, Ziyan Yuan, Emily Xue and Ting Ji.
Fangda assisted the HSBC Group to set up China’s first wholly foreign-owned Fintech company. HSBC Fintech Services (Shanghai) Co., based in Shanghai’s Lingang New Area pilot free trade zone, was set up on September 7, 2020 and officially launched on January 9, 2021. The subsidiary has a registered capital of US$34 million.
The establishment and business operation of HSBC Fintech is the first initiative by a multinational financial group to capitalize on the opportunities presented by China’s fast-growing Fintech sector. HSBC Fintech will offer centralised technology and data services. Its first product is aimed at providing health and wealth protection for employees. HSBC Fintech will also support HSBC Private Banking’s wealth planning division with technological innovation and roll out support to licensed financial institutions within and outside the Group.
Fangda’s highly regarded financial regulatory team advised on all Chinese law aspects of setting up HSBC Fintech, including securing regulatory approval, registration, compliance and advising on internal governance. The Fangda team was led by partners Zhiyi Ren and Lily Yin, and included associates Zoe Shi and Siyu Gao.
Fangda has advised Amundi BOC Wealth Management Co., the first Sino-foreign JV wealth management company, on the successful issue of its first wealth management product. This is a publicly offered closed-end net-worth wealth management product with an annualized performance comparison benchmark of 4.65%.
Amundi BOC is the first JV wealth management company established by a Chinese commercial bank and an overseas financial institution. The two shareholders are Credit Agricole Asset Management Co., the largest European asset management company (which holds 55% of the shareholding), and Bank of China Wealth Management Co., a subsidiary of Bank of China (which holds 45%). It is registered in Lingang New Area in the Shanghai Pilot Free Trade Zone with registered capital of RMB1 billion.
Fangda advised Amundi BOC on the product issuance, including on custody, sales, investment and valuation documents. The team comprised partner REN Zhiyi and counsel Allen Wang of Fangda’s asset management practice.
Fangda represented a buyer consortium led by Shanghai Wanye Enterprises, a leading Chinese scientech company, on its approximately US$398 million acquisition of Compart Systems from Platinum Equity. The acquisition is part of Wanye’s strategic objective to push ahead in its semiconductor equipment and integrated circuit businesses. The deal was signed on November 12, 2020 and announced on December 23, 2020.
Singapore-headquartered Compart Systems is a leading global supplier of highly engineered gas delivery system and flow control components and assemblies. It is one of a few global companies with the vertical integration manufacturing capability of highly engineered components. Compart’s primary operations are in the PRC and Malaysia. Platinum Equity is a Los Angeles-based global private equity firm.
The Fangda M&A team was led by partners Norman Zhong, Raymond Chan and Chuck Sun, supported by counsel Frank Ding, associate Joyce Pei, Danny Li and Siyao Li. Fangda advised on legal due diligence, transaction negotiation and documentation, underwriting of insurance aspects, and offshore equity financing, as well as PRC regulations. Fangda coordinated local counsel support, including Allen & Gledhill in Singapore, Rahmat Lim & Partners in Malaysia, and Covington & Burling as the U.S. counsel.
Leading Chinese law firm Fangda Partners advised NavInfo Co. Ltd., a market-leading Chinese navigation software and map company, on its successful copyright infringement claim against three Baidu companies found to be using “substantially similar software” without permission. The Beijing Intellectual Property Court awarded NavInfo RMB64.5 million (US$9.8 million) in damages, the highest damages award for copyright infringement cases in China to date.
NavInfo brought the case against Beijing Baidu Netcome Technology Co., Ltd., Baidu Online Network Technology (Beijing) Co., Ltd., and Baidu Cloud Computing Technology (Beijing) Co., Ltd.
The court held that the electronic maps developed and owned by NavInfo constituted a graphic work under the Copyright Law. The defendants’ software—“Baidu Map,” “Baidu Carlife,” “Baidu Navigation,” and other software using electronic maps—was substantially similar to, and used without authorization, NavInfo’s electronic maps, thus infringing NavInfo’s copyright.
In addition to awarding damages, the court granted an injunction enjoining the Baidu companies from infringement and ordered the defendants to issue a public apology.
Founded in 2002, NavInfo is the market leader in navigation maps, navigation software development, dynamic traffic information, location big data, and customized connected vehicle services for both passengers and commercial vehicles.
Partner Alexandra Yang commented: “We are pleased to have been entrusted by our client to help enforcing this high-profile, complex copyright infringement case, which successfully serves to protect the core IP rights of our client, and solidify the social consensus of protecting the core IP rights of electronic maps.”
The Fangda team was led by partner Alexandra (Pu) Yang.
Fangda has advised a buyer consortium on its proposed take-private with leading biopharmaceutical company China Biologic Products Holdings, Inc. (“China Biologic”). The consortium comprises Centurium Capital, CITIC Capital, Marc Chan, Hillhouse Capital, Temasek Holdings, and other financial institutions and management members. The deal was announced on November 19, 2020.
China Biologic’s products are used as critical therapies during medical emergencies and for the prevention and treatment of life-threatening diseases and immune deficiency-related diseases. China Biologic was founded in 2002 and listed on NASDAQ in 2009. Under the merger agreement, the buyer consortium will pay US$120 per share to acquire a 68.84% stake in China Biologic, implying an equity value of China Biologic of about US$4.8 billion.
Fangda Partners acted as PRC legal counsel to the buyer consortium, including providing due diligence, and negotiating and drafting the financing transaction agreement and the bank loan agreement. The Fangda corporate team was led by partners Leo Lou and Diana Li, and team members included Elaine Wang, Shuwen Hu, Tingting Huang, Siyu Chen, Xiaobo Wen, Jiali Yang, and Yifei Huang. The banking & finance team was led by partner Stanley Chen, supported by Harry Xu.
Fangda acted as Hong Kong counsel to JW (Cayman) Therapeutics Co. Ltd. (Stock code: 2126) on the listing of JW Therapeutics’ ordinary shares on the Main Board of the Stock Exchange of Hong Kong and the concurrent global offering. The listing and global offering raised approximately HK$2.3 billion (prior to exercise of the underwriters’ over-allotment option).
JW Therapeutics is a leading clinical and pre-clinical stage cell therapy company in China, with a vision to develop innovative cell therapies for the China market to transform the treatment of cancer for Chinese patients.
The listing and the closing of the global offering took place on November 3, 2020. Goldman Sachs and UBS acted as joint sponsors of the listing and, together with CICC and Citic Securities, as joint global coordinators, joint bookrunners and joint lead managers of the global offering.
The Fangda team was led by partner Colin Law, and the team members comprised counsel Jonathan Wallenberger, associates Alan Au, George Chen and Yilin Lu, and paralegal Tracy Ho.
Fangda represented iRay Technology Company Limited in its initial public offering and listing on the SSE STAR Market (Shanghai Stock Exchange Science and Technology Innovation Board) on September 18, 2020.
The IPO raised a total of RMB2.2 billion from the issue of 18.2 million shares. This is the largest IPO project in the special equipment manufacturing industry on the SSE STAR Market to date.
iRay Technology is China’s top manufacturer of digital X-ray detectors, is one of the world’s leading enterprises in the research, development and production of digital X-ray detectors, and one of the world’s few digital X-ray detector manufacturers that has mastered the four core sensor technologies. The company’s listing on the SSE STAR Market is significant as China localizes the production of core components of high-end medical devices.
Fangda advised and represented iRay Technology in its pre-IPO financings, onshore and offshore restructuring and the IPO. The Fangda team was led by partners Qiang Ma and Ke Luo, supported by associates Yuhan Zhang and Kevin Liu.
Fangda, as lead legal counsel, represented TCL Technology Group Co., Ltd. (“TCL Technology”) and China Star Optoelectronics Technology Co., Ltd. (“TCL CSOT”), a subsidiary of TCL Technology, in their acquisition of Samsung Display’s LCD plant in Suzhou for US$1.08 billion. The Suzhou plant comprises Samsung’s only 8.5th generation LCD production line in mainland China. The deal was signed on August 28, 2020, subject to customary closing conditions.
TCL Technology and TCL CSOT’s strategic acquisition of the Samsung 8.5th generation LCD plant underscores TCL Technology’s strategic aim to become a global leading technology industry group. On completion, TCL CSOT will operate three 8.5th generation large-size display production lines, capable of manufacturing 440,000 large panels a month.
The deal was led out of Fangda’s Greater Bay offices in Shenzhen and Hong Kong. Fangda provided the full range of transaction services and legal advice to the buyer as well as coordinating Korean local counsel. The deal was concluded on a very tight timescale. The Fangda team was led by partners Qiang Ma and Wei Chen, and team members included Qin Liu, Anqi Hu, Haipan Hu, Lijuan Sun, Duncan Deng and Viola Jiang. Partners Michael Han and Jin Wang and team members Yun Dong and Joy Wong supported the corporate team to coordinate antitrust clearance in multiple jurisdictions worldwide .
Fangda has advised AstraZeneca, the British-Swedish multinational pharmaceutical and biopharmaceutical company, on a licensing deal with Shenzhen Kangtai Biological Products Co., Ltd. (“BioKangtai”), under which AstraZeneca will aim to supply the adenovirus vector-based COVID-19 vaccine, AZD1222, to China. AZD1222 is currently being developed by the University of Oxford, with whom AstraZeneca signed an agreement in April to build a number of supply chains in parallel across the world. BioKangtai has agreed to build capacity to make at least 100 million doses of the vaccine by the end of 2020 and 200 million doses per year by the end of 2021, for the China market. The two companies said that they will explore the possibility of cooperation in other regions and markets. At the moment, Phase II and III clinical trials of COVID-19 vaccine are being undertaken in many countries, with the objective of testing the vaccine’s effectiveness and the safety and immune response of the vaccine for different age groups as well as inoculation rates.
Leon Wang, Executive Vice-President, International and President of AstraZeneca China, said: “We hope to leverage BioKangtai’s technology and manufacturing capability to enable the supply of AZD-1222 in China. We believe that with the cooperation of governments, international organizations, NGOs, and companies around the world, we can overcome the challenges created by the COVID-19 pandemic. We aim to make the University of Oxford’s vaccine widely accessible around the world in an equitable manner.”
Fangda advised AstraZeneca on all aspects of the licensing deal, including providing due diligence, drafting, amendment, and translation of the framework agreement, and handling negotiation. The team was led by partner Josh Shin, supported by team members Bella Wang, Muriel He, and Jiali Yang.
Fangda is advising EF Education First (“EF”) in connection with a major investment by the global investment firm Permira in the EF Kids & Teens Business, which is headquartered in Switzerland with schools in China and Indonesia. Permira will acquire a majority stake in the EF Kids & Teens business, with EF retaining significant ownership in the business. The completion of Permira’s investment remains subject to customary conditions.
With over 20 years of successful operations, EF Kids & Teens is a market leader in premium English language education with 288 schools across 62 cities in China and 79 schools in Indonesia and one of the largest networks of international teachers. Over the past few months, EF Kids & Teens has successfully helped hundreds of thousands of students lean online through EF’s proprietary learning platform and live EF teachers from around the world.
Founded in Sweden in 1965, EF Education First is a leading international education company which focuses on academics, travel and cultural experiences. Globally, EF has 600 offices and schools in 50 countries, as well as a research and development unit headquartered in Switzerland. In China, EF has three divisions: Kids and Teens Schools, Adults Education and Study Abroad.
Permira is a global investment firm. Founded in 1985, the firm advises private equity funds and makes long-term investments with a total committed capital of approximately USD48 billion. The Permira funds have made over 250 private equity investments in four key sectors: Consumer, Services, Healthcare and Technology.
The Fangda corporate team is advising on international cross-border as well as domestic Chinese aspects of this landmark transaction, and includes Hong Kong-based partner Mark Lehmkuhler, Beijing-based partner Chen Bao and Shanghai-based partner Sherry Xu; Beijing-based partners Michael Hanand Caroline Huang are providing antitrust advice on the transaction.
Fangda advised WuXi AppTec on its placement of 68.2 million H-shares at a price of HK$108 each. The placement, which concluded on July 29, 2020, raised HK$7.4 billion. The agents included Morgan Stanley, Huatai Securities, Goldman Sachs, and J.P. Morgan.
WuXi AppTec is a global pharmaceutical, biopharmaceutical and medical devices company, providing comprehensive laboratory research and R&D services from drug discovery through development to market delivery.
Fangda’s mainland China and Hong Kong teams worked together to advise WuXi AppTec, a longstanding client. The mainland China team was led by Xueyan Jiang, and team members included Yvonne Gan, Yanhui Hu, Janice Jia, and Ellyn Ai. The Hong Kong team was led by Colin Law and Arman Lie, and team members included Brian Kwok, Ting Him Chan, Karen Chan, and George Chen.
Fangda represented Huatai United Securities as sponsor and lead underwriter in Sunshine Guojian Pharmaceutical (Shanghai) Co., Ltd. (Sunshine Guojian)’s initial public offering and listing on the SSE STAR Market (Shanghai Stock Exchange Science and Technology Innovation Board) on July 22, 2020. The IPO raised over RMB1.7 billion.
Sunshine Guojian is one of the first batch of Chinese biopharmaceutical companies manufacturing antibody drugs, and already has three regulator-approved therapeutic antibody drugs in China. The company’s R&D concentrates on developing antibody drugs, particularly aimed at the treatment of autoimmune diseases and tumors. It is the largest of all the biopharmaceutical companies in China, and has some 10 antibody drugs under development.
Sunshine Guojian is the first STAR market-listed company in the biopharmaceutical industry to be spun off from a Hong Kong-listed company (3SBio Group).
Fangda represented China International Capital Corporation Limited as joint sponsor and lead underwriter in Semiconductor Manufacturing International Corporation (SMIC)’s initial public offering and listing on the SSE STAR Market (Shanghai Stock Exchange Science and Technology Innovation Board) on July 16, 2020. The IPO raised over RMB46 billion (over RMB53 billion after the exercise of the over-allotment option). SMIC’s IPO is the largest on the STAR Market to date.
SMIC is one of the world’s leading integrated circuit (IC) companies, as well as being the most advanced semiconductor manufacturer in China. SMIC is the first overseas listed red chip enterprise to enter the A-share capital market through this type of offering.
Fangda advised on all aspects of the offering, including legal research, corporate governance, and consultation with all domestic and international securities regulatory agencies.
Fangda acted as PRC legal counsel to Morgan Stanley & Co. LLC and BofA Securities, Inc. as underwriters on the IPO and listing of Agora, Inc. (Agora) on the Nasdaq Global Select Market in the US on June 26, 2020.
In the listing, Agora offered 17.5 million American Depositary Shares (ADSs), raising approximately US$350 million (before the greenshoe option), as well as selling approximately $110 million worth of shares in a private placement.
Agora, a leading voice, video and live interactive streaming platform, provides developers with simple-to-use, customizable and widely compatible APIs (application programming interfaces) to embed real-time video and voice into their applications without the need to build the infrastructure themselves. Agora is the first company in the real-time, platform-as-a-service (PaaS) sector to list.
Fangda represented Haier Electronics Group Co., Ltd. (HK Stock Code: 1169) (“HEG”) in the privatization of HEG by way of a scheme of arrangement and the withdrawal of listing of HEG (the “Privatization”).
As consideration for the Privatization, Haier Smart Home Co., Ltd. (“HSH”) will issue 1.60 new HSH H Shares and make a Cash Payment of HK$1.95 per HEG share. The Privatization of firm intention was announced on July 31, 2020 and the scheme document was despatch on November 16, 2020.
In the Privatization, HEG is estimated to be valued over US$11 billion, this is the largest scale privatization of a Hong Kong listed company as of July 31, 2020.
The Fangda team on this deal was led by partners Colin Law, Edward Bong, Xueyan Jiang, Jian Fang, Siyuan Pan, the team members comprised associates Hong Ding, Eric Li, Yao Zhang and Yvonne Gan. Fangda advised on the transactions, prepared for the transaction documents and other related documents.
Fangda acted as PRC legal counsel to Credit Suisse Securities (USA) LLC and China International Capital Corporation Hong Kong Securities Limited as underwriters on the IPO and listing of Genetron Holdings Limited (Genetron) on the Nasdaq Global Select Market in the US on June 19, 2020.
In the listing, Genetron offered 16 million American Depositary Shares (ADSs), raising approximately US$256 million (before the greenshoe option) and making it the largest IPO offering globally for a precision oncology company.
Genetron is a leading Chinese precision oncology company, focusing on cancer molecular profiling and harnessing advanced technologies in molecular biology and data science to improve cancer treatment.
Fangda advised Huatai Financial Holdings (Hong Kong) Limited and UBS AG London Branch as joint global coordinators, along with other joint bookrunners, on all PRC legal issues related to the issuance of global depositary receipts (“GDRs”) by China Pacific Insurance (Group) Co. Ltd. (“CPIC”) on the London Stock Exchange. CPIC raised US$1.8 billion (prior to any exercise of the over-allotment option) or US$2 billion (assuming full exercise of the over-allotment option) through the issuance on the Shanghai-London Stock Connect Segment (Shanghai Segment) of the London Stock Exchange. The net proceeds will be mainly used to develop CPIC’s businesses overseas and support its core insurance business growth. The GDRs commenced trading in London on June 22, 2020 (London time). This is the largest capital raise via an admission to London Stock Exchange in 2020 to date.
Founded in 1991, CPIC is an insurance holding company incorporated on the basis of China Pacific Insurance Company, and a leading insurance group in China.
CIPC's GDR issuance is innovative in connection with Shanghai-London Stock Connect in a number of respects: it is the first GDR to adopt Chinese accounting standards; it introduces a cornerstone investor mechanism with a long-term lock-up arrangement; and it is the first to receive a public float waiver as a non-European company.
After the listing on LSEG, CPIC has become the first ever A+H+G (‘Shanghai+Hong Kong+London’) simultaneously listed insurance company and the second Chinese company to list GDRs in London utilizing Shanghai-London Stock Connect.
Fangda represents Asian Infrastructure Investment Bank (AIIB) on its RMB3 billion panda bond offering on China’s interbank bond market. This is the first panda bond offering by an issuer rated AAA by international credit rating agencies after the promulgation of the current panda bond rules.
The 3-year sustainable development bonds carry the Combating COVID-19 label approved by the National Association of Financial Market Institutional Investors and zero percent risk weighting in China.
The issuance received extraordinary support from both onshore and offshore investors (including through the Bond Connect Regime)， and were subscribedwith 35% allocated to domestic and 65% to international investors. The bonds were priced at a coupon rate of 2.40% per annum, 23 bps lower than the valuation of China Development Bank bonds, reflective of AIIB’s strong credit fundamentals.
The net proceeds will be included in the ordinary resources of AIIB, supporting to fund part of COVID-19 Crisis Recovery Facility, to upgrade the country’s sustainable public health infrastructure and provide emergency equipment and supplies in response to the COVID-19 pandemic. RMB2.5 billion of the proceeds will be used as the COVID-19 containment development in China.
The successful issuance of the Panda bond , showcasing milestone significance, contributing to enhancing global investor base such as multilateral development banks and prestigious global issuers to enter Chinese debt market, as well as the internationalization of China’s capital markets.
On November 15, 2019, pursuant to the Shanghai Bankruptcy Court’s order under the Enterprise Bankruptcy Law (“EBL”), CEFC Shanghai International Group Limited (“CEFC”) went into bankruptcy liquidation. On November 24, 2019, the Shanghai Bankruptcy Court appointed the Shanghai Office of King & Wood Mallensons, AllBright Law Offices, and Fangda Partners as joint administrators of the CEFC Bankruptcy Case.
According to an application by the joint and several administrators of CEFC Shanghai International Group Limited (the “Administrators”) to seek recognition and assistance in Hong Kong, the High Court of the Hong Kong Special Administrative Region (HKSAR) ( “High Court”) made and issued the Order on December 18 and 20, 2019, and rendered the Decision accordingly on January 13, 2020, in which the Court recognized the liquidation in the Mainland of the People’s Republic of China (the “Mainland”) and the appointment of the joint and several administrators appointed by Shanghai No.3 Intermediate People’s Court (“Shanghai Bankruptcy Court”) and recognized that the Administrators have and may exercise the relevant powers in the HKSAR. All proceedings in HKSAR against CEFC are now pending. This was the first application in Hong Kong made by Mainland administrators for recognition of their appointment and judicial assistance under common law.
In order to prevent a creditor from obtaining a garnishee order absolute, on December 10, 2019 the Shanghai Bankruptcy Court issued a Letter of Request urgently to the High Court to request the High Court recognize the appointment of the Administrators and to allow the Administrators, to the greatest extent permitted under Hong Kong laws, to be entitled to the rights under the EBL and judicial interpretations. Based on the Letter of Request and other relevant materials, the Administrators made an urgent application to the High Court for recognition and assistance.
The Honorable Mr. Justice Harris granted the recognition and assistance sought by the Administrators. In essence, the orders invested in the Administrators the same powers in cross-border insolvencies as Hong Kong liquidators. This case is expected to promote a unitary approach in cross-border insolvency, and also be referred to as a precedent in the HKSAR, which will be cited in similar cases in the future.
For the first time in history, a bankruptcy liquidation in the Mainland has been recognized by a Hong Kong court in the HKSAR. It is also the first time in the history of Hong Kong courts that they will provide judicial assistance to the Mainland bankruptcy proceedings.
Fangda represented China International Capital Corporation (CICC) as sole sponsor and lead underwriter in the IPO and listing of China Resources Microelectronics (CRM) on the SSE STAR Market (Shanghai Stock Exchange Science and Technology Innovation Board) on February 27, 2020, raising approximately RMB3.8 billion (RMB 4.3 billion from the Full Exercise of the Over-Allotman Option). CRM is a semiconductor company incorporated in the Cayman Islands and with its principal business operation in the PRC. CRM is China’s first red-chip to list on the A-share market, paving way for other overseas-listed red-chip companies to return to the home market.
