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AstraZeneca has drawn up plans to break out its China business and list it separately in Hong Kong as a way to shelter the company against mounting geopolitical tensions.
The Anglo-Swedish drugmaker began discussing the idea with bankers several months ago and is among a growing number of multinational companies now considering that option, according to three people familiar with the talks.
A separation might not ultimately take place, the same people cautioned. One of the people said listing the entity in Shanghai was also possible.
The discussion shows the significant restructuring multinational corporations could be forced to undertake as they adapt to growing friction between China and the US and its allies.
Earlier this month Sequoia, the Silicon Valley venture capital group, said it would spin off its China business and run it as a “completely independent” entity from its US operations. Neil Shen, the billionaire founder of Sequoia China, said there was “much less in common now” between the Sequoia entities.
Under the plans AstraZeneca, which is the UK’s biggest listed company by market value at £183bn, would carve off its operations in China into a separate legal entity but would retain control of the business.
The idea has been “on the table for a few years”, one adviser to AstraZeneca said, adding that it had been sidelined until recently amid a global downturn in biotech stocks.
“Every multinational with a strong China business” seems to have considered a similar move, one senior Asia-based banker said. “Even if it’s just the option to give you flexibility in the future, it’s worth thinking about.”
A person briefed on AstraZeneca’s plans said listing a
