The New Year has started brightly for RTW Biotech Opportunities (RTW ) as its largest private holding JiXing Pharmaceuticals recieved further investment that will allow it to expand and its acquisition of Arix Bioscience (ARIX) could complete by the end of the quarter.

The fund’s investment manager RTW Investments injected $127m (£100m) into the Chinese clinical-stage biopharma company, which it founded in 2019, and German pharma company Bayer AG invested $35m.

JiXing makes up 9.1% of the £348m London-listed fund’s portfolio and is the second-largest position, according to the November factsheet.

As part of the investment terms Bayer and JiXing will form a joint portfolio committee to focus on cardiovascular diseases and ophthalmology in China, with president of Bayer Greater China Xiaolan Zhou joining JiXing’s board.

‘JiXing is on an exciting growth trajectory, driven by a world-class research and development team with a unique understanding of how to most effectively deliver innovative therapies that address complicated diseases to millions of patients in China and beyond,’ RTW’s chief investment officer Rod Wong (pictured) said.

Arix investors to vote on 29 January

The trust will also be hoping it can get its deal to buy Arix over the line. 

Shareholders in the one-time Woodford favourite Arix are scheduled to vote on RTW’s bid at a general meeting on 29 January, with the deal completed by the end of the quarter if successful, according to a prospectus published last week.

The offer has the support of the board and largest shareholder Acacia Research, whose combined stake is 26.3%. 

Arix shareholders will receive 1.4633 new RTW shares for each share held, implying a valuation of 143p per share, based on the average share price over the month ahead of the acquisition announcement. 

This represented a 46% premium to the shares at close before Arix announced its strategic review in July but is a 10% discount to Arix’s 30 November NAV of 177p, according to the prospectus.

Last year Arix’s corporate broker Peel Hunt resigned over the preferential treatment of Acacia which is recieving cash, while other shareholders are receiving what the broker deemed liquid and highly-discounted shares in RTW.

RTW offered Acacia $57.1m, equivalent to 143p per share at the announcement date and 136p at the date of the circular.

Arix’s board noted that a traditional merger on a NAV-for-NAV basis would not have been approved by shareholders, so RTW’s next option included the outright purchase of the Acacia stake, the prospectus said. A committee independent of Acacia directors approved this.

If successful, RTW stands to gain assets estimated to be worth $213m at a cost of $146m. Upon completion, Arix shareholders excluding Acacia are expected to hold 39% of the combined entity.

Shares in Arix soared 6% to 135p this week in response to US pharmaceutical company Merk acquiring its portfolio company Harpoon Therapeutics, a US clinical-stage immuno-oncology company. The company made up 1.7% of the £239m NAV as at the end of June.

Shares in RTW have rallied 22% since announcing the bid offer, but at 140 cents, remain at a double-digit discount of 16% to the end of November NAV of 165 cents per share.

The Telegraph’s Questor column tipped the fund last week.