Pharmaron Completes RMB 2.18B Zero-Coupon Convertible Bond Offering, Raising About US$327M Net

The US-dollar-settled zero-coupon convertible bonds, with a principal of RMB 2.18 billion maturing in 2027, settled on September 2 at an initial conversion price of HK$36.08 per H share, raising about US$327.2 million net — roughly 70% of which will fund expansion of laboratory services and CDMO services.

Pharmaron (03759.HK) announced that its issue of US-dollar-settled zero-coupon convertible bonds with an aggregate principal of RMB 2.18 billion maturing in 2027 completed settlement on September 2, 2026. The initial conversion price is HK$36.08 per H share, subject to adjustment.

Size and Use of Proceeds

Gross proceeds from the subscription were approximately US$330.8 million, with net proceeds of approximately US$327.2 million after fees and expenses. The net proceeds are intended to be used as follows:

Approximately 70% (about US$229.04 million) to support business expansion and development of laboratory services and CDMO services; approximately 20% (about US$65.44 million) to refinance certain existing debt and optimize the capital structure; and approximately 10% (about US$32.72 million) for general corporate purposes and working capital.

Dilution and Listing Arrangements

Assuming full conversion, the company's total share capital would increase from 1,835,416,798 shares to 1,905,895,377 shares, with bondholders holding 70,478,579 H shares, or about 3.70% of total issued share capital. The conversion H shares have been approved for listing and trading by the Hong Kong Stock Exchange's listing committee, and the convertible bonds were approved for listing on the Vienna MTF operated by the Vienna Stock Exchange, with trading commencing September 2, 2026. The company will complete CSRC filing and SAFE registration as required.

The financing aligns with the company's capacity and M&A pace this year. H1 revenue reached RMB 7.595 billion, up 17.92% year on year, with CDMO services revenue up 32.78% and new CDMO orders up more than 50%. During the same period, Pharmaron added RMB 3 billion of investment in Shaoxing and signed an approximately RMB 2 billion new site in Hangzhou's Qiantang District, and raised RMB 1.185 billion in cash through a placing of new H shares. This mix of capital tools secures funding for capacity delivery, though pressure from depreciation and finance costs will persist for some time.