Sinovac Biotech (SVA) Management Buyout Offer Undervalues Company by 75% - Heng Ren
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The management bid for Sinovac Biotech Limited (NASDAQ: SVA) needs to be raised by 75%, Peter Halesworth, Managing Partner of Heng Ren Investments LP and a Sinovac shareholder, argued in a letter to the board.
Halesworth and Thomas D. Grant, CFA, co-author of the analysis, showed that Sinovac’s intrinsic value is $10.84, versus The Insider's buyout offer of just $6.18 per share.
In the analysis, Halesworth and Grant said annual sales of EV71, Sinovac’s breakthrough vaccine to inoculate children in China from Hand, Foot, and Mouth Disease (HFMD), could eventually reach $400 million.
"The management buyout offer is an epic failure of corporate governance by Sinovac’s Insiders, and a red flag for the future,” stated Peter Halesworth, Managing Partner of Heng Ren Investments LP and a Sinovac shareholder. “If this poor treatment of shareholders is rewarded, it will surely be repeated.”
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