BEIJING (dpa-AFX) - China-based SINOVAC Biotech Ltd. (SVA) Monday announced that its Board of Directors has alerted shareholders to a new lawsuit by Advantech/Prime Success, which threatens to prevent payment of $55 special dividend to all valid shareholders.
The company noted that Advantech/Prime Success on June 12 filed a Petition for Emergency Injunctive Relief against SINOVAC, et al., naming as relief parties Cede & Co., The Depository Trust Co., and Equiniti, the dividend paying agent retained by the SINOVAC Board.
The company expects to file its Opposition Brief against the Petition today at 5:00 p.m. Atlantic Standard Time, followed by a hearing on Wednesday, June 18.
Sinovac Biotech in April declared a special cash dividend of $55 per share, with payment scheduled on or about July 9.
The provider of biopharmaceutical products now noted that Vivo Capital's counsel informed the paying agent that Vivo would challenge the dividend and asked the paying agent to withdraw from facilitating the distribution of the $55 dividend declared by the SINOVAC Board.
The company said, 'We continue to be shocked by the self-serving, unnecessary actions by Advantech and Vivo Capital, together known as the 'Dissenting Investor Group, against SINOVAC, threatening the rightful dividend payment to all valid SINOVAC common shareholders.'
Sinovac Biotech added that these incomprehensible actions are unacceptable to its Board because the Dissenting Investor Group has already pocketed more than $1.1 billion in dividends from SINOVAC's operating subsidiary, while all SINOVAC's valid shareholders received nothing.
The company also noted that an amount equal to the aggregate amount of cash that would be payable under the $55 per common share special dividend in respect of the 2018 PIPE shares has been set aside by its Board in an escrow account managed by an independent third party pending final resolution of the legal proceedings, which the Dissenting Investor Group initiated.
With this, there is no risk whatsoever that the Dissenting Investor Group's allocations of the dividend will not be paid if the courts ultimately decide in their favor regarding the PIPE shares, the firm added.
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