Pharmesis International and its wholly-owned subsidiary, Chengdu Kinna Pharmaceutical, has entered into a sale and purchase agreement with Chengdu Kinna Investment, to acquire the remaining 19% equity interest in Sichuan Longlife Pharmaceutical.
Prior to the proposed acquisition, Sichuan Longlife has been a subsidiary of the group, with a 51% equity interest owned by Chengdu Kinna Pharmaceutical since the group’s initial public offering in 2004.
In 2019, Chengdu Kinna Pharmaceutical further acquired an additional 30% of Sichuan Longlife from the Chengdu Kinna Investment at a purchase consideration of RMB 15.7 million ($2.9 million).
The purchase consideration for the proposed acquisition stands at RMB2,830,000, to be paid in two instalments, with 10% and 90% to be paid in the first and second instalments respectively.
The purchase consideration represents a discount to approximately 20% of the net book value of the equity interest, which stood at RMB3,538,000, as at June 30.
The proposed acquisition is set to be funded through the group’s internal sources of funds.
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Shares in Pharmesis International BFK closed flat at 12.3 cents on Sept 23.
