The Taiwan Stock Exchange yesterday (20 June) approved the listing of Diamond Biofund, making it the first in Taiwan a venture capital firm has been publicly listed. 

Looking ahead, Diamond Biotech hopes to play a more multi-functional role in linking more international capital, markets, technologies and products to Taiwan," said William Lu, Chairman of Diamond Biofund.

Diamond Biofund's application for listing has a paid-in capital of $6.35 billion and its main business is venture capital. The major shareholders include Microbio and Oneness Biotech (40%), Fubon Financial (33.46%), Taishin Holdings (9.66%) and Taishin Holdings (4.98%).

The Stock Exchange said that since this is the first venture capital listing case, in order to strengthen corporate governance and stabilise management, it comes with an extended period of depository for major shareholders, and also requires more stringent conditions such as increasing the number of independent directors to more than two-thirds and strengthening information disclosure in order to clarify external concerns.

The Exchange explained that the current rules stipulate that for general companies applying for listing, the majority shareholder's compulsory pooling of shares can be fully redeemed after one year, while for companies listed on the Taiwan Innovation Board, the compulsory pooling of shares can only be fully redeemed after two years. After discussion at the Board of Directors' meeting, the time period for the Diamond Biofund depository will be lengthened, but the actual length of the period is still under further consideration.

The Board of Directors of the Stock Exchange requested Diamond Biofund to increase the number of independent directors to at least two-thirds of the total number of directors. The Board of Directors also requested Diamond Biofund to clearly explain the monthly and quarterly disclosures, as well as the fair value of its investment targets, so that investors can more easily assess the reasonableness of the company's share price.

Mr Lu said that since its establishment in 2013, Diamond Biofund has had a good track record, especially in investing in early-stage biotechnology projects in Taiwan. Looking ahead, Diamond Biofund hopes to play a more multi-functional role in linking more international capital, markets, technologies and products to Taiwan.

Lu said that the biotechnology industry is the core industry of Taiwan in the future, but the investment period of the biotechnology industry is too long and the risk is too high, and the outpout of Taiwan's biotechnology industry accounts for only 0.4% globally. He pointed out that although the output value of Taiwan's biotech capital market exceeds NT$1 trillion, it is still insignificant compared to its Asian neighbours, with Japan's biotech capital market value at around NT$16 trillion, China's 33 trillion, Hong Kong's 8 trillion and Korea's 6 trillion.