U.S. bio-tech company Roivant Sciences, which received an equity investment from SK Group, was valued at US$7.3 billion ahead of its listing on the New York Stock Exchange. The company’s value is similar to that of Moderna Therapeutics, which set the record for the biggest biotech IPO at US$7.5 billion in 2018.
Roivant Sciences is planning to be listed on NASDAQ during the third quarter of this year through a merger with a special-purpose acquisition company (SPAC). This approach allows a company to raise funds from investors through an IPO and then merge with an appropriate partner.
Roivant Sciences recently signed a contract with Patient Square Capital, an investment company specializing in healthcare, to be listed via the SPAC method. The company will marry Montes Archimedes Acquisition Corp. established by Patient Square Capital.
Roivant Sciences has developed a business model that reduces new drug development periods and cost through a platform that utilizes artificial intelligence (AI) and data transformation (DT) technologies.
SK Inc., which is the holding company of SK Group, forged a strategic partnership with Roivant Sciences in December last year by investing US$200 million in its subsidiary focusing on targeted proteolytic drugs. These drugs are expected to greatly improve the level of treatment for incurable diseases if they are successfully commercialized because they are more effective than drugs currently available and cause no resistance problems.
Although the exact amount of the stake in Roivant Sciences held by SK Inc. has not been disclosed, it is expected to make a significant profit if Roivant Sciences is listed on the stock market. However, current investors such as SK Inc. reportedly agreed to safe custody terms not to sell at least 50 percent of its holdings for the next three years after listing Roivant Sciences.
SK Inc. has been hitting the jackpot in global investments. Grab in which SK Inc. invested 250 billion won in 2018 is also seeking to be listed on NASDAQ through a merger with an SPAC. Grab has been valued at US$39.6 billion, the largest-ever corporate value among companies to be listed through the SPAC method. SK Inc. also made huge profits when ESR, a global logistics center company, was listed on the Hong Kong stock market in 2019. The company invested US490 billion won in ESR in 2017. SK’s stake in ESR is 10 percent of which 4.6 percent was sold in September 2020, making a profit of 480 billion won. In 2019, it invested 370 billion won in Wason, China, which produces copper foils, a key material for electric vehicle batteries. In January 2021, it invested 1.6 trillion won in Plug Power, a global hydrogen company, along with its affiliate SK E&S.
“SK Inc. built a successful model where the company has become more active as an investment company like private equity funds while rarely playing its roles as a holding company,” said an official of the Korean business community.