NEW YORK (GenomeWeb) – Grifols said on Thursday that it will acquire a 26.2 percent stake in Shanghai RAAS as part of a strategic alliance agreement to manufacture, market, and develop plasma products and transfusion diagnostic solutions in the Chinese market.
Under the agreement, Grifols will acquire its stake in Shanghai RAAS in exchange for 45 percent of the economic rights and 40 percent of the voting rights of Grifols Diagnostic Solutions, its US subsidiary. Grifols Diagnostic Solutions' valuation is $4.28 billion, and the price per share of Shanghai RAAS is RMB 7.50.
The price tag of the transaction to Grifols is about $1.9 billion, and no external financing is required to fund the transaction.
Upon completion of the transaction, Grifols will become the second-largest shareholder in Shanghai RAAS, a company operating in the plasma derivatives sector.
Grifols said that China has become one of the fastest growing hemoderivatives markets in recent years, and demand for nucleic acid testing technology is forecast to grow significantly along with increased adoption of "leading-edge diagnostic solutions to enhance the safety of blood and plasma donations."
The firm said that the agreement will reinforce its global expansion strategy and commercial presence in China and generate value for all of its divisions and particularly its bioscience and diagnostic divisions.
Grifols said that the agreement will enable Shanghai RAAS to diversify its business. Shanghai RAAS will become Grifols' exclusive distributor of plasma-derived products and transfusion diagnostic solutions in China and will use Grifols' NAT to screen plasma donations throughout its 41 plasma collection centers.
Grifols will appoint three members to Shanghai RAAS's board of directors, and it will appoint quality and manufacturing officers to guarantee compliance with a quality assurance agreement included in the strategic alliance
The transaction is expected to close in the second half of 2019, pending regulatory approvals.