Shenzhen Capchem Technology Co., Ltd. (SZSE:300037) signed a framework agreement to acquire 74.2% stake in Jiangsu Jiujiujiu Technology Co., Ltd. from YanAn Bicon Pharmaceutical Listed Company (SZSE:002411) for CNY 2.2 billion on November 2, 2020. Shenzhen Capchem Technology Co., Ltd. (SZSE:300037) signed share purchase agreement to acquire 74.24% stake in Jiangsu Jiujiujiu Technology Co., Ltd. from YanAn Bicon Pharmaceutical Listed Company (SZSE:002411) on November 12, 2020. The consideration will be paid in cash.

As part of consideration to be paid by Shenzhen Capchem, an intention deposit CNY 10 million shall be paid. Within 5 days from the date of the announcement of the items in this agreement, a deposit of CNY 90 million shall be paid. At the same time, the above-mentioned intention deposit of CNY 10 million will also be converted into a deposit.

50% of the transaction price shall be paid within 5 working days from the date when the Shenzhen Capchem shareholders meeting approved the transaction. At the same time, the above deposit will be automatically converted into a part of the transaction price, that is, a payment of CNY 1.013 billion is required. Within 30 days from the delivery date of the underlying asset, 50% of the transaction price shall be paid, that is, CNY 1.1136 billion.

As part of consideration to be paid by Zhou Xinji, a deposit of CNY 30 million shall be paid within 10 days after the entry into force of the agreement, and the deposit will be automatically transferred to the transaction price of this transaction on the delivery date of the underlying asset. The remaining transfer price of this transaction (that is, the remaining CNY 360 million after deducting the automatically transferred transaction price of the deposit) shall be paid in installments within three years from the delivery date, and the annual payment amount shall not be less than one-third of the total price of the transaction One, namely CNY 120 million. In a separate transaction, Zhou Xinji intends to acquire 13% stake in Jiangsu Jiujiujiu Technology Co., Ltd. from YanAn Bicon Pharmaceutical Listed Company (SZSE:002411) for about CNY 390 million.

As on September 30, 2020, Jiangsu Jiujiujiu Technology reported total assets of CNY 2.19 billion, net assets of CNY 1.45 billion. As on December 31, 2019, Jiangsu Jiujiujiu Technology reported total assets of CNY 2.37 billion, net assets of CNY 1.4 billion, total revenue of CNY 1 billion, operating profit of CNY 66.5 million, net profit of CNY 50 million. Post completion, YanAn Bicon Pharmaceutical Listed Company won't hold any shares in Jiangsu Jiujiujiu Technology Co., Ltd. Transaction is subject to customary closing conditions, including shareholder approval of YanAn Bicon, Jiangsu Jiujiujiu Technology and Shenzhen Capchem.

After the completion of the audit, evaluation and other work involved in the transaction, Shenzhen Capchem and YanAn Bicon once again need to convene the board of directors to review and approve the relevant proposals of the transaction. On November 12, 2020, YanAn Bicon Pharmaceutical held the 10th meeting of the fifth directorate and the 9th meeting of the fifth board of supervisors and approved the acquisition. On January 11, 2021, the company held the sixteenth meeting of the fifth board of directors and the eleventh meeting of the fifth board of supervisors.

The Proposal on Termination of Material Asset Purchases was reviewed and passed, The company and YanAn Bicon Pharmaceutical Listed Company, Jiangsu Jiujiujiu Technology Co., Ltd., and Zhou Xinji signed the Conditional Termination Agreement for Equity Transfer Matters. As of December 4, 2020, The Board of Directors of YanAn Bicon Pharmaceutical Listed Company approved the deal. As of December 28, 2020, the transaction was approved in the 10th Extraordinary Shareholders Meeting of 2020 of YanAn Bicon Pharmaceutical Listed Company.