Shanghai Century Acquisition Drops Kelun Pharma Purchase

Shanghai Century Acquisition (SHA), a special purpose acquisition corporation, has ended its attempt to buy Sichuan Kelun Pharmaceutical Co., Ltd., a deal that was announced on May 28, 2007. Shanghai Century said it did not believe it could win the necessary government approvals for the purchase in time to close the purchase by the date mandated by its own charter.

In its prospectus, Shanghai Century included specific dates by which it had to announce and then complete a deal that would be equal to at least 80% of the assets in the company, which were raised in the IPO.

The agreed upon purchase price for Sichuan Kelun was $231 million in an all-stock deal, if Sichuan Kelun met all of its performance milestones.

Shanghai Century will instead purchase a non-biopharma company called Asia Leader Investments Limited, which in turn owns 67% of New Goal International, for $70 million. New Goal is involved in structured finance and financial leasing. Because both Asia Leader and New Goal are Hong Kong based, the deal will not require any approvals from China governmental entities. The operations for New Goal, however, are on the mainland, which was a requirement for Shanghai Century Acquisition.

The original article on the SHA-Kelun merger is here.

Disclosure: none.