China-based Sinovac Biotech Ltd. (NASDAQ: SVA) announced that its Board of Directors has unanimously determined that the partial tender offer by Alternative Liquidity Index LP to acquire up to 10,000,000 common shares of Sinovac for USD 0.03 apiece in cash is not advisable and is not in the best interests of the Company or its shareholders. The Board of Directors recommends that shareholders reject the tender offer and not tender their shares for purchase pursuant to the offer by Alternative Liquidity.
Sinovac’s Valuation Concerns and Cash Holdings
Sinovac believes the implied valuation based on the Offer Price is less than the value of the company’s assets. As of June 30, 2023, the company’s cash and cash equivalents and restricted cash totaled USD 1.6 billion. This substantial cash position is a key factor in the Board’s assessment of the offer’s inadequacy. Alternative Liquidity has acknowledged that it lacks any accurate means for determining the present value of Sinovac’s shares.
Opportunistic Offer and Shareholder Interests
Alternative Liquidity has a history of making similar unsolicited partial tender offers for the stock of other public companies. Given the offer price, the Board of Directors views the Tender Offer as an opportunistic attempt by Alternative Liquidity to profit by purchasing shares at a very low price relative to their value. The Board is concerned that accepting the offer would deprive shareholders who tender their shares of the potential opportunity to realize the full long-term value of their investment in Sinovac.-Fineline Info & Tech
