Taiwan’s capital markets malaise
A falling number of corporates are choosing to list on the Taiwan Stock Exchange. Given the dire after-market performance of Aslan Pharmaceuticals, it is not hard to see why.
|Taipei is not the place you go to complete big equity capital markets transactions,
wherever you come from
When Aslan Pharmaceuticals cast around for the right place to sell shares earlier this year, it did not choose Hong Kong, nor its hometown of Singapore, nor even mainland China’s two leading bourses, but Taiwan.
Aslan’s chief executive Carl Firth, a former head of Asia healthcare investment banking at Bank of America Merrill Lynch, was convinced it was the right decision. The firm’s lack of profitability – it posted a small pre-tax loss in 2016 – had ruled out Hong Kong, while the US exchanges were deemed too volatile. Singapore was also nixed, due to the lack of biotech firms listed in the Lion City.
Taiwan, however, was a different matter. The Taiwan Stock Exchange (TSE) was widely viewed as a sleepy little bourse lacking the liquidity and trading volumes of Shanghai or Hong Kong. But it had its upsides.
The island boasts one of the world’s best-run and most-generously funded public healthcare systems. Moreover, a host of biotech corporates had successfully listed on the TSE in the past, led by TaiMed Biologics and ScinoPharm, making it, on the surface at least, a logical listing venue.