Zhejiang Zhenyuan to acquire 51 pct stake in drug distributor
Shanghai. March 31. INTERFAX-CHINA - Zhejiang Zhenyuan Co. Ltd. (Zhejiang Zhenyuan), a leading drug maker and distributor, plans to acquire a 51 percent stake in Shaoxing Medicine Supply Distribution Co. Ltd. for a maximum of RMB 7 million ($1.07 million), Zhejiang Zhenyuan announced March 30.
Zhejiang Zhenyuan aims to increase its share of Shaoxing City's drug distribution market through the deal, particularly the hospital market, the announcement said. Both companies are based in the city in Zhejiang.
Shaoxing Medicine's main clients in Shaoxing are hospitals. The firm reported sales revenue of RMB 134.24 million ($20.47 million) and net losses of RMB 4.62 million ($704.55 million) in 2010.
Shaoxing People's Hospital, which at present holds a 60.625 percent share in Shaoxing Medicine, will see its stake diluted to 29.7 percent through the deal, while Shaoxing Maternal Child Care Hospital will see its 36.25 percent share diluted to 17.8 percent. The remaining 3.125 percent owned by six individual investors will be reduced to 1.5 percent.
Zhejiang Zhenyuan is China's largest manufacturer of the antibiotic roxithromycin, Interfax previously reported.
- MS