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[HONG KONG] Samsung Biologics, the pharmaceutical arm of the South Korean conglomerate, is set to raise about 2.25 trillion won (S$2.8 billion) in an initial public offering that was priced at the high-end of a marketed range.
The company, a contract manufacturer for drugmakers, priced its IPO at 136,000 won a share. It said early October that it would offer about 16.5 million shares in the range of 113,000 won to 136,000 won apiece.
The listing of the pharma business offers the South Korean conglomerate a new area of growth to offset pressures in its smartphone operations. Samsung Group, whose business interests range from TVs to finance, has invested in new areas such as pharmaceuticals to offset saturation in the cellphone market.
This month, the group's Samsung Electronics Co, the maker of Galaxy mobile phones, reported a 17 per cent plunge in quarterly profit after reports about battery fires forced it to kill its Note 7 line.
Samsung Biologics is a contract manufacturer for big pharmaceutical companies that develop biologic medicines, which are complex drugs made of live substances.
The global biologic medicines market is projected to exceed US$390 billion by 2020, according to an IMS Consulting Group report funded by drugmaker Novartis. These treatments are more complex to research and manufacture than other drugs and can address previously treatable conditions with higher efficacy and fewer side effects.