(Yicai) Jan. 14 -- WuXi AppTec’s shares rose after the pharmaceutical services provider sold stakes in an affiliated company, pocketing HKD2.4 billion (USD312 million) after transaction costs. It is the second asset sale the Chinese firm has announced in the past month.

WuXi AppTec [SHA: 603259] ended 3.4 percent up at CNY55 (USD7.50) a share in Shanghai today, while its Hong Kong-listed stock [HKG: 2359] gained 4.1 percent to close at HKD54.15 (USD6.96).

WuXi AppTec announced late yesterday that the Shanghai-based company had pared its stake in WuXi XDC Cayman through two block trades on Nov. 8 and Jan. 10. The total shares sold accounted for about 7.2 percent of WuXi XDC's total equity.

The company, which is named in the proposed US Biosecure Act, announced the sale of its cell and gene therapy units -- Philadelphia-based WuXi Advanced Therapies and Oxford Genetics -- to US private equity firm Altaris on Dec. 24 in a retreat from non-core businesses.

Then on Jan. 6, affiliated company WuXi Biologics said its subsidiary WuXi Vaccines plans to sell its vaccine plant in Ireland to US drugs giant Merck Sharp & Dohme for around USD500 million.

WuXi AppTec said that the cash proceeds from selling WuXi XDC’s shares would be used to step up its global operational capabilities, attract and retain top talent, and strengthen its business model as an integrated contract research, development, and manufacturing organization.

The firm said sales of WuXi XDC’s equity had generated estimated investment income of CNY2 billion (USD275 million) over the past 12 months, equal to more than a 10th of its audited net profit for 2023. About CNY720 million (USD98.2 million) will be included in last year’s earnings and CNY1.3 billion in this year’s, it added.

WuXi XDC, an outsourcing services company, develops antibody-drug conjugates and other bioconjugates. It was set up as a joint venture between WuXi Biologics and unit WuXi STA Pharmaceutical Hong Kong Investment in 2013 and went public in Hong Kong in November 2023.

Shares of WuXi XDC [HKG: 2268] ended 1.9 percent higher at HKD29.45 apiece today, after tumbling 12.4 percent yesterday. WuXi Biologics [HKG: 2269], from which WuXi XDC was spun off in July 2022, added 4.1 percent to close at HKD17.60.

WuXi AppTec's stock plunged more than 23 percent last year after the US Biosecure Act designated it as a "biotechnology company of concern,” along with other Chinese businesses. The proposed legislation targets Chinese biotech firms on the alleged grounds of national security.

WuXi AppTec reiterated last May that what the bill says about the company is neither appropriate nor accurate, and the firm abides by the laws and regulations of the countries where it does business, including China and the United States. WuXi AppTec noted that it does not pose a security threat to any country.

Editors: Tang Shihua, Martin Kadiev