Citiorient Helped Jiuzhou Pharmaceutical in Cross-border Acquisition of Suzhou Novartis


On September 4, 2019, Zhejiang Jiuzhou Pharmaceutical Co., Ltd. (hereinafter referred to as "Jiuzhou Pharmaceutical" or "buyer") announced that, Jiuzhou Pharmaceutical and Novartis International Pharmaceutical Investment Ltd. (hereinafter referred to as "Novartis Investment" or "counterparty" or “the seller”) signed the Equity Acquisition Agreement, and intends to purchase 100% of the equity of Suzhou Novartis Pharmaceutical Technology Co., Ltd. (hereinafter referred to as "Suzhou Novartis" or “target company”), held by the counterparty, after the asset divestiture of technology and drug development, with a self-financing fund of about RMB 790 million.


While signing the Equity Acquisition Agreement, the two sides also agreed on the content of a Manufacturing and Supply Agreement. The agreement stipulates that within five years from the date of delivery of this transaction, Jiuzhou Pharmaceutical will supply Novartis International Pharmaceutical Branch Ireland ("Novartis Ireland") with raw material and intermediate of three pharmaceutical products (the indications of these products are anti-heart failure treatment, breast cancer treatment and leukemia treatment, respectively) produced by Novartis Group through the target company.


Novartis AG (hereinafter referred to as "Novartis Group") is a global pharmaceutical group, which was listed on the New York Stock Exchange in 2000 (stock code: NVS.N). Novartis Group, headquartered in Basel, Switzerland, has about 108,000 employees from more than 140 countries worldwide and has operations in about 155 countries worldwide. Novartis is improving people's quality of life and prolonging human life by imagining the future of medicine. In the process of exploring new drugs, Novartis has been innovating and its investment in R&D has always been in the forefront of the industry in the world.


According to Novartis Group's annual report for 2018, Novartis Group had total assets of 145.563 billion US dollars and net assets of 78.692 billion US dollars by the end of 2018, net sales of 51.9 billion US dollars and net profit of 12.614 billion US dollars by 2018. Novartis Group ranked the top five in the pharmaceutical industry in net sales in 2018.


In this transaction, Citiorient acted as the buyer's consultant for Jiuzhou Pharmaceutical Industry, providing customers with key services such as financial due diligence, valuation, transaction structure design, business negotiation, etc. Especially in the final negotiation stage before the signing of the agreement, the company assisted customers in competing for key terms and finally successfully facilitated the signing of the transaction agreement. The project team's professional competence in cross-border M&A is displayed to the full extent. Citiorient has once again helped Chinese enterprises to get "internationalized" growth and seek common development with leading multinational companies in the world.