fosun pharma entered into cooperation framework agreement with wenzhou tcm hospital to jointly establish geriatrics hospital
recently, shanghai fosun pharmaceutical (group) co., ltd.* (“fosun pharma” or the “company”, stock code: 600196-sh,02196-hk) announced that shanghai yicheng hospital investment management company limited* (上海醫誠醫院投資管理有限公司) (“shanghai yicheng”), a wholly-owned subsidiary of the company, entered into a cooperation framework agreement (the “framework agreement”) with wenzhou hospital of traditional chinese medicine* (溫州市中醫院) (“wenzhou tcm hospital”), pursuant to which it was proposed that the parties shall make capital contributions and jointly establish a hospital, tentatively named as wenzhou geriatrics hospital* (溫州老年病醫院#) (“geriatrics hospital”), specializing in treatment of new chronic diseases and geriatric diseases.
wenzhou tcm hospital shall make contributions by daishimen main hospital’s fixed assets, including land, buildings and equipment, beneficially owned by it, and shanghai yicheng shall make contributions in cash. shanghai yicheng shall become the controlling shareholder of geriatrics hospital company. the actual shareholding proportion of the parties in geriatrics hospital company shall be determined by the parties in accordance with the valuation results of assets of wenzhou tcm hospital.
wenzhou tcm hospital is a tier-three class a traditional chinese medicine hospital in the prc. it has currently four hospitals, namely dashimen main hospital, jingshan hospital, shuixin hospital and the new liuhongqiao hospital which is under construction, and has a designated bed capacity of 880 beds.
according to the announcement, upon execution of the framework agreement, the parties shall immediatelycommence due diligence and at the same time formulate the development plan of the new hospital, thereby realizing the positioning and objectives of it.
fosun pharma stated in the announcement that the cooperation is one of the initiatives for the company to explore the opportunities in establishing a hospital with diversified ownership, which can further improve the regional deployment and the development of the healthcare service business of the company.
during the recent years, fosun pharma achieved stable expansion in healthcare services, which is one of the key development business segments of the company. at present, the company has basically formed the strategic deployment of healthcare service business including high-end healthcare in coastal developed cities and the combination of special clinics and general hospitals in second and third-tier cities. fosun pharma has formed a foundation for its healthcare service business segment. it is expected that the implementation of diversified ownership in the healthcare service segment is conducive to the positive collaboration between the advantages of the hospitals funded and operated by non-public resources and the resources of the public hospitals, which can benefit more patients.
in 2010, fosun pharma expanded into the domestic high-end medical treatment service market through strategic cooperation with chindex international inc., and jointly promoted the development of “united family hospital”, a high-end medical treatment service brand of chindex in china. in the meantime, the company also marched into the special and general medical services market of china by investing in anhui jimin cancer hospital (安徽濟民腫瘤醫院), yueyang guangji hospital (岳陽廣濟醫院), suqian zhongwu hospital (宿遷鐘吾醫院) and foshan chancheng hospital (佛山襌城醫院).
according to the announcement, as the detailed arrangements in relation to the cooperation will be determined by shanghai yicheng and wenzhou tcm hospital upon further negotiation, the relevant cooperation is subject to the definitive capital contribution or asset transfer agreement to be entered into by the parties and the terms thereunder.