China Grand Pharmaceuticals enter into JV with HuangShi Feiyun

HuangShi Feiyun and China Grand Pharmaceutical and Healthcare Holdings Ltd. have entered into a joint venture which will be established in Huangshi, the PRC. The purpose of establishing the joint venture company is to set up a national naturally-sourced medicine research and development and manufacturing base in Huangshi, the PRC. The joint venture company will be owned beneficially as to 60% by Grand Pharm and as to the balance of 40% by HuangShi Feiyun. Upon its establishment, the joint venture company will become a 60% owned subsidiary of the company. Pursuant to the terms of the JV agreement, the registered capital of the joint venture company will be RMB 125,000,000 (equivalent to approximately HKD 155,300,000 or $20m). RMB 75,000,000 (equivalent to approximately HKD 93,200,000 or $12m) will be contributed by Grand Pharm by way of cash and the balance of RMB 50,000,000 (equivalent to approximately HKD 62,100,000 ) will be contributed by HuangShi Feiyun as to RMB 30,000,000 (equivalent to approximately HKD 37,300,000) by way of injection of intangible assets in the joint venture company and as to RMB 20,000,000 (equivalent to approximately HKD 24,800,000) by way of cash.