Glass Lewis Recommends 3SBio Shareholders Vote against Management Buyout Proposal

Fri Apr 12, 2013 10:30am EDT

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http://pdf.reuters.com/htmlnews/8knews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20130412:nBw125555a

* Advisory firm cites inadequate valuation, unfair sale process and excessive
management influence
* OrbiMed reiterates plans to vote against the transaction

NEW YORK--(Business Wire)--
OrbiMed Advisors LLC ("OrbiMed") today announced that Glass Lewis & Co., a
leading provider of corporate governance services to institutional shareholders,
has recommended that shareholders of 3SBio (SSRX:NASDAQ) vote AGAINST the
company`s going-private acquisition by a consortium of buyers that includes the
company`s Chairman and CEO and other senior executives. 

In its report, Glass Lewis stated, "We`re ultimately uncomfortable with
management`s influence on the proposed transaction and the board`s handling of
these matters given the unique circumstances of the Company and the value
offered to unaffiliated shareholders in the proposed buyout." 

The report specifically criticizes management`s handling of a third-party offer
for 3SBio at a value significantly higher than the agreed upon buyout price:
"Were it not for the CFO`s and management`s stiff-arming of Party A, we believe
the Company likely could have sold itself for a higher price than presently
offered to shareholders." 

Glass Lewis also concluded that the company`s business prospects suggest a
higher buyout value: "Given the continued positive outlook of {3SBio},
consisting of projected double-digit revenue growth and healthy profit margins,
as well as some indications in the valuation analysis that the buyout price may
be on the low side, management`s proposed offer appears insufficient in our
view." 

In response to the Glass Lewis report, OrbiMed said, "We concur with this
report`s criticism of the flawed buyout process and management`s inherent
conflicts, and as one of 3SBio`s largest shareholders (9.5% of outstanding
ADSs), we intend to vote our shares against the transaction." 

About OrbiMed

OrbiMed Advisors LLC is a leading investment firm dedicated exclusively to the
healthcare sector, with approximately $7 billion in assets under management.
OrbiMed invests globally across the spectrum of healthcare companies, from
venture capital start-ups to large multinational companies. OrbiMed`s team of
over 60 professionals manages a series of private equity funds, hedge funds,
royalty funds and other investment vehicles.

OrbiMed Advisors LLC
Samuel D. Isaly, Managing Partner
212-739-6400
Georgeson Inc.
David S. Drake
212-440-9861 

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