Freshfields and Simpson Thacher called in by Alibaba on $2.5bn online pharmacy deal
Alibaba Group looks to regular adviser Simpson Thacher as Freshfields advises health subsidiary
April 16, 2015 at 07:03 PM
2 minute read
Freshfields Bruckhaus Deringer and Simpson Thacher & Bartlett have been called up as lead advisers as Chinese e-commerce giant Alibaba Group strikes an agreement to transfer its online pharmacy business to its Hong Kong-listed sister company.
Under the terms of the $2.5bn (£1.7bn) deal, struck yesterday, Alibaba Group will take majority ownership of its digital healthcare sister company, Alibaba Health Information Technology, in exchange for transferring the e-pharmacy operations of its Tmall.com shopping website to Alibaba Health.
As a result of the transaction, which is expected to close in the third quarter of 2015, Alibaba Group's stake in Alibaba Health will rise from 38% to 53%.
A Simpson Thacher team run by Hong Kong partner Celia Lam and China practice leader Leiming Chen is representing Alibaba Group on the deal.
Regulatory support was provided by partner and former chief of the US Justice Department's criminal fraud section Jeffrey Knox in Washington.
Freshfields Hong Kong corporate partner Edward Freeman and China chair Teresa Ko are heading up the team advising Alibaba Health.
Simpson Thacher's Chen has a history with Alibaba, having led the team that advised the e-commerce company on its flotation on the New York Stock Exchange last autumn.
The firm has acted on several other big-ticket M&A deals for Alibaba over recent years, including its buyouts of mobile browser UCWeb and digital mapping company AutoNavi.
Freshfields and Ko – the firm's China chair and top Hong Kong initial public offering (IPO) partner – also advised Alibaba on the IPO, but the firm was replaced by Simpson Thacher before the listing.
Alibaba Health's operations include the China Drug Electronic Regulation Platform, the government's database of drug licences. It will now also take charge of the Tmall.com online shopping platform, which currently hosts 186 licensed pharmacies.
Alibaba Group chief operating officer Daniel Zhang said that healthcare will be "a strategically important growth area" for the company.
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