Fosun Pharma Continues to Increases Shares of Chindex

After repeatedly increase its share of Chindex International, Inc. (CHDX. Nasdaq), Fosun Pharma Group (600196.SH) upgrades the cooperation relationship for both parties to a new stage.

On 28th Dec, 2010, Fosun Pharma Group signed an agreement with Chindex International, Inc. to announce a brand new joint venture enterprise called Chindex Medical Ltd is going to be built in Hongkong, so as to integrate medical equipment (hereinafter referred to as MPD) businesses which were affiliated to each party respectively. In this case, Fosun Pharma Group shall inject the whole MPD business (excluding medical diagnosis business) and holds 51% majority stock ownership, in the mean time, Chindex shall inject all MPD business and holds 49% stock ownership.

Chen Qiyu, Chairman of Fosun Pharma Group, said the combination of Fosun Pharma Group and Chindex is another milestone for its international development strategy; meanwhile, it is an important symbol for strength inner integration development for the company. In the future, the new joint company shall not only optimize and integrate both sides MPD business to bring the Fosun Pharma Group s MPD business to reach a new stage, but also perfect the industry chain for Fosun s MPD section from R&D, manufacturing and marketing in domestic and overseas.

It is learned that Fosun Pharma Group and Chindex formerly had signed Stock Purchase Agreement and Shareholder Agreement, Chindex shall additional issue private placement totally 1,990,447 shares of class A common stock to Fosun Pharma Group by the rate of USD 15 per share on certain conditions by two times, as this action is done, Fosun Pharma Group shall hold 25% Chindex s stock ownership in maximum.

The new joint venture will satisfied Chindex s condition in the secondary offering, accordingly Fosun Pharma Group versus Chindex s shareholding ratio reach to 25%, and consequently Fosun Pharma Group will accomplish all trade with Chindex smoothly to achieve mutual strategy alliance and cooperation.

Chindex is a stateside medical health company which is offering medical health service and supply heavy medical instruments to China s market. Being an upgrade version of Chindex s MPD, the joint venture will continuously sell the products of large-scale multinational companies including Siemens Imaging Equipment, Da Vinci Surgical robot, as well as Hologic, Candela, and Cutera, etc.

The joint venture will act as distribution partner for instruments like color Doppler echocardiographic machine, mammary glands machine, laser equipment of beauty and surgical robot, and continues offer the loan business through Export-Import Bank of United States and KfW Development Bank of Germany for Chinese hospitals who purchase these MPD instruments.

Meanwhile, as a successor of Fosun Pharma Group s MPD business (excluding clinical diagnosis products), the joint venture will entitle these manufacturing entities for dental products and its consumables, medical suture wire and medical macromolecule consumables.

Roberta Lipson, President & CEO of Chindex said: we were considered many strategic choices for MPD Business Division, we believe there are much more development potentials by setting joint venture with Fosun Pharma Group, we are happy to have it operated in the time of new year coming. From our point of view, the business integration this time will favor mutual complement and generate synergetic scale effect which anyone of us can not achieve severally.