Ascentage Pharma Announces Partial Exercise of Underwriters’ Option to Purchase Additional American Depositary Shares

Rhea-AI Summary

Ascentage Pharma (Nasdaq: AAPG, HKEX: 6855) announced that underwriters of its U.S. initial public offering have partially exercised their over-allotment option to purchase an additional 935,144 American depositary shares (ADSs) at $17.25 per ADS. Each ADS represents four ordinary shares of the company.

Following this partial exercise, the total number of ADSs sold in the offering will increase to 8,260,144, bringing the aggregate gross proceeds to approximately $142.5 million, before deducting underwriting discounts, commissions, and other offering expenses. J.P. Morgan and Citigroup served as joint book-running managers for the offering.

Positive

• Additional capital raise of $16.1 million through over-allotment exercise
• Total gross proceeds reached $142.5 million from the offering
• Strong underwriter support with participation from major banks J.P. Morgan and Citigroup

Negative

• Potential dilution for existing shareholders due to additional ADS issuance
• Increased offering expenses and underwriting costs

Insights

Investment Banking Analyst

The partial exercise of the over-allotment option by underwriters represents a significant milestone for Ascentage Pharma's capital raising strategy. The over-allotment option, commonly known as a greenshoe option, allows underwriters to purchase additional shares if demand exceeds initial supply, helping to stabilize the stock price post-IPO.

The successful placement of an additional $16.1 million worth of ADSs (935,144 shares at $17.25) brings the total offering to $142.5 million, providing substantial working capital for their pharmaceutical development pipeline. The exercise of this option typically indicates strong institutional interest and market confidence in the company's prospects.

The dual-listing structure on both NASDAQ and HKEX positions Ascentage strategically to access diverse capital markets and investor bases. This is particularly valuable for biotech companies that require significant ongoing capital for drug development and clinical trials. The backing of premier investment banks J.P. Morgan and Citigroup adds institutional credibility and suggests thorough due diligence of the company's fundamentals.

For existing shareholders, while this additional issuance creates some dilution, the enhanced liquidity and stronger balance sheet should provide greater financial flexibility for advancing their drug candidates through clinical development. The successful completion of this capital raise positions Ascentage more competitively in the global biotech landscape.

ROCKVILLE, Md. and SUZHOU, China, Feb. 07, 2025 (GLOBE NEWSWIRE) -- Ascentage Pharma (Nasdaq: AAPG, HKEX: 6855) announced today that the underwriters of its underwritten U.S. initial public offering (the “Offering”) have partially exercised their over-allotment option to purchase an additional 935,144 American depositary shares (“ADSs”) at the initial public offering price of $17.25 per ADS less underwriting discounts and commissions. Each ADS represents four ordinary shares of Ascentage Pharma. After giving effect to the partial exercise of the over-allotment option, the total number of ADSs sold by Ascentage Pharma in the Offering will increase to 8,260,144 ADSs and the aggregate gross proceeds to Ascentage Pharma will be approximately $142.5 million, before deducting underwriting discounts and commissions and other offering expenses payable by Ascentage Pharma. The closing of the over-allotment option is subject to customary closing conditions.

J.P. Morgan and Citigroup acted as joint book-running managers for the offering.

About Ascentage Pharma

Ascentage Pharma is a global, integrated biopharmaceutical company engaged in discovering, developing and commercializing therapies to address global unmet medical needs primarily in hematological malignancies. Ascentage Pharma has been listed on the Main Board of the Stock Exchange of Hong Kong Limited with the stock code 6855.HK since October 2019 and has also been listed on the Nasdaq Global Market under the ticker symbol “AAPG” since January 2025.

Contacts

Investor Relations

Hogan Wan, Head of IR and Strategy
Ascentage Pharma
Hogan.Wan@ascentage.com
+86 512 85557777

Stephanie Carrington
ICR Healthcare
Stephanie.Carrington@icrhealthcare.com
(646) 277-1282 

Media Relations

Sean Leous
ICR Healthcare
Sean.Leous@icrhealthcare.com
(646) 866-4012

FAQ

How many additional ADSs did Ascentage Pharma (AAPG) sell through the over-allotment option?

Ascentage Pharma sold an additional 935,144 American depositary shares (ADSs) through the partial exercise of the over-allotment option.

What is the total value of Ascentage Pharma's (AAPG) IPO after the over-allotment exercise?

After the partial exercise of the over-allotment option, the total gross proceeds reached approximately $142.5 million, before deducting expenses and commissions.

What was the price per ADS in Ascentage Pharma's (AAPG) over-allotment offering?

The additional ADSs were sold at the initial public offering price of $17.25 per ADS.

How many ordinary shares does each Ascentage Pharma (AAPG) ADS represent?

Each American depositary share (ADS) represents four ordinary shares of Ascentage Pharma.

What is the total number of ADSs sold by Ascentage Pharma (AAPG) in the offering?

The total number of ADSs sold in the offering increased to 8,260,144 after the partial exercise of the over-allotment option.