GIC-backed Novotech Health eyes IPO again after gaining US$3b valuation

[NEW YORK] Private equity giant TPG's Novotech Health Holdings raised fresh financing valuing the business at US$3 billion, as it considers another run at an initial public offering (IPO) after a deal was pulled last year.

The transaction, backed by existing shareholders including Sequoia Capital and Singapore sovereign fund GIC, raised US$255 million in equity through a private placement, according to a Novotech statement Wednesday (Jan 19). The clinical research and testing provider also refinanced US$505 million of debt that was due to expire next year.

The equity valuation is about a third higher than the US$2.3 billion Novotech was valued at when it last raised money almost a year ago. At that time, the firm was already one of the most successful investments for the private equity group in Asia, after increasing revenues by more than 30 per cent a year under TPG's ownership since 2017. TPG remains its controlling shareholder.

TPG is preparing to bring the business to public markets as soon as this year, according to people with knowledge of the matter, who asked not to be identified. New York is being considered as a listing destination, as well as Hong Kong, the people said.

Novotech in September cancelled plans for a Hong Kong listing that was expected to raise US$700 million because of volatility in Asia's markets. Chairman Anand Tharmaratnam at the time said the company will "continue to evaluate a potential IPO".

Founded in Sydney, Novotech operates in 10 countries. China is its biggest and fastest-growing market, generating 60 per cent growth in net new business in 2021. It's among the largest biotechnology contract research businesses across China, South-east Asia, Taiwan and South Korea, working with biotech firms to conduct clinical trials across all phases.

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The biotech clinical research firm is seeking to grow "by pursuing various strategic M&A and tech enablement initiatives", chief executive officer John Moller said in the statement.

UBS Group advised on the private placement.

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