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Investment firm Catalyst Capital Group Inc. is in extended talks to sell part of a Canadian biotech company it owns after the Chinese partnership that had agreed to buy it fell apart.

3SBio Inc., based in Shenyang, China, said the joint venture disbanded after “certain conditions” in the agreement were not completed by an April 30 deadline. 3SBio had agreed last September to buy the contract development and manufacturing (CDMO) business of Therapure Biopharma Inc., which is based in Mississauga, Ont., for US$290-million.

In the original announcement, the deal was expected to close by the end of 2017. Now, there is no firm closing date.

The Chinese firm had been working with a partner, China’s Citic Private Equity Funds Management Co. (CPE Funds). Now, 3SBio is discussing a new deal with Therapure, an executive with the company said on Friday. CPE is not expected to be part of any new arrangement.

“I can confirm that we are continuing discussions with Therapure regarding the CDMO transaction,” Dr. James Ji Zhang, chief executive officer of 3SBio’s CDMO business, said in an e-mail that was forwarded by Catalyst to The Globe and Mail.

It is not known whether a new deal would include other investors, should it come to fruition.

For Catalyst, led by Toronto financier Newton Glassman, the protracted talks complicate the firm’s plans realize value for its Therapure stake. Therapure is one of a number of investments Catalyst is trying to turn into cash, amid questions about valuations of some of the firm’s holdings, its ability to get out of investments at desirable prices and its practice of extending the lives of its funds.

The fund extensions have delayed the day when Catalyst clients can get back the money they’ve handed to Mr. Glassman’s firm. Catalyst has raised approximately $5-billion for its funds, including a number of large North American pension plans, such as the retirement funds at McGill University and the University of Toronto.

In March, believing that the sale of Therapure’s CDMO business was nearing completion, Catalyst told investors in a confidential letter that it hoped to realize US$100-million in a U.S. initial public offering for the remaining business of Therapure.

But then 3SBio, which is listed on the Hong Kong exchange, said in a regulatory filing on May 1 that it had terminated the asset purchase when it and its partner were unable to meet certain unspecified conditions, creating the impression that the sale of Therapure’s CDMO business was dead. Indeed, one Chinese news agency, Caixin Global, reported that 3SBio had “scrapped” the deal.

However, Catalyst insisted that talks were still going on.

In the filing, 3SBio said it had entered into a one-month exclusivity agreement with Catalyst and CPE Funds to ”explore alternate business opportunities and arrangements” for the CDMO business, and that the agreement could be extended.

When the original deal was announced in September, it was touted as the start of a strategic partnership involving Catalyst, 3SBio and CITICPE, which advises CPE funds. The CDMO business was to produce plasma proteins in its existing facilities and also build a new plant to supply markets in the United States in Canada, according to the initial news release.

Catalyst had ascribed a value of US$662-million to Therapure at the end of 2016, according to documents cited in a Reuters article on the private-equity firm published in March. In early 2016, Catalyst had planned an IPO worth US$867-million, but subsequently pulled the offering, according to the report.

In the confidential March letter to its investors – the contents of which Catalyst tried, unsuccessfully, to have a judge block publication by The Globe – the firm said Therapure’s early-stage protein plasma business, known as Evolve Biologics, could raise US$100-million on the NASDAQ stock exchange, a transaction that would value the entire company at US$400-million to US$500-million. Documents for the offering were filed with the U.S. Securities and Exchange Commission in February. It said in the letter that it would announce the IPO for Evolve after the CDMO sale closed.

Besides Therapure, Catalyst told its investors in that letter that it was planning an IPO of another holding, Gateway Casinos & Entertainment Inc., with a value of C$400-million. There has yet to be a filing for such an offering, and in recent weeks it emerged that financial advisers, including investment banks Morgan Stanley and CIBC World Markets Inc., are gauging interest in an outright sale to a competitor instead of a public listing.

Catalyst has also been frustrated in its plans to sell another holding, publicly traded Callidus Capital Inc., a lender to distressed companies. It began a process to privatize the company in 2016, suggesting Callidus was worth $18 to $22 a share, based on a valuation by National Bank Financial. The stock has fallen steadily, however, amid a series of disappointing financial results, closing on Friday at $6.13 on the Toronto Stock Exchange.

- With reporting by Nathan VanderKlippe in Beijing