Fosun Pharma to strengthen diagnostic reagent business
Shanghai. February 12. INTERFAX-CHINA - Shanghai Fosun Pharmaceutical (Group) Co. Ltd., a Shanghai Stock Exchange-listed pharmaceutical and medical device manufacturer and distributor, announced on Feb. 12 that its subsidiaries will purchase stakes in a diagnostic reagent company in view of the industry's growth potential in China.
According to the statement, the company's subsidiary, Shanghai Fosun Pingyao Investment Management Co. Ltd., will acquire about 24.51 million domestic shares in Hong Kong Stock Exchange-listed BioSino Bio-technology and Science Inc. from Beijing Holdings Hi-tech Develop Co. Ltd. for RMB 50.97 million ($7.44 million). The domestic shares cannot be traded publicly.
Furthermore, BioSino Bio-technology will issue approximately 31.29 million H shares. Fosun Pharma subsidiary, Fosun Industrial Hong Kong Co. Ltd., plans to buy 6.78 million of the shares at a per-share price of RMB 2.08 ($0.30). Beijing Enterprises Holdings Ltd., an investment company, plans to buy the remainder of the shares for the same price.
After the transactions, BioSino Bio-technology will have a total of 131.3 million domestic shares and H shares. Fosun Pingyao will hold 18.66 percent of its total shares, while Fosun Industrial will hold 5.16 percent.
According to the announcement, Shanghai Fosun has a positive view on the diagnosis business growth in China, as China's health care reform has brought opportunities for development.
A research report by the China Social Economic Investigation and Research Center issued in 2007 said that China's diagnostic reagent market reached RMB 3 billion ($439.24 million) to RMB 4 billion ($585.65 million) in 2007 and grew at the annual rate of 15 percent to 20 percent.
BioSino Bio-technology launched its initial public offering on the GEM of the Hong Kong Stock Exchange in 2006, and is now one of China's largest in-vitro diagnostic manufactures with about 90 IVD products.