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Fosun Pharma Announced RMB538 Million Investment On The Restructuring of Xuzhou Coal Mining Group’s Hospital

Time:2016/8/9 8:36:04

    On 23 February 2016, Fosun Pharma announced that the Company had entered into a Health industry restructuring agreement with Xuzhou Coal Mining Group Corporation and Taikang Life Insurance Co.Ltd . These three parties plan to establish a new joint venture to collaboratively conduct the restructure of Xuzhou Coal Mining Group Corporation’s healthcare institutions. The announcement disclosed that Fosun Pharma’s investment is no more than RMB538.46 million, which would account for 35% shareholding of the joint venture.

    According to the agreement, the restructuring involves following institutions: General Hospital of Xuzhou Coal Mining Group (including Prevention and Treatment Center for Occupational Diseases of Xuzhou Coal Mining Group), No.1 Hospital of Xuzhou Coal Mining Group, No.2 Hospital of Xuzhou Coal Mining Group, and Pangzhuang, Qishan, Quantai, Qingshanquan Branch of the three directly affiliated hospitals mentioned above, as well as collective enterprises etc; and 5 mining hospitals and their branches including Zhangji Mining Hospital of Xuzhou Coal Mining Group Company Limited which is under direct management of Xuzhou Coal Mining Group Corporation. 

    The management of Fosun Pharma expressed that the cooperation is the Company’s breakthrough in the restructuring of state-owned enterprises of healthcare industry and co-operating with local large-scale healthcare institutions and leading insurance companies, which is of great significance to its presence in the reform of mixed-ownership of SOE hospital and integration of healthcare industry chain. Meanwhile, the cooperation will optimize the healthcare resources allocation of the restructured assets, and optimize the regional footprint allocation of Fosun Pharma ’s healthcare services by the synergies between the restructured assets and the Fosun Pharma ’s original healthcare services presence, which lay a solid foundation for setting up a regional healthcare center and establish the macro health industry chain.

    In the meantime, Fosun Pharma’s announcement also disclosed several potential risks: In addition to relevant management agreements, supply chain agreement and other agreements which are in process of negotiation and final confirmation among these three parties, staff resettlement scheme of the aforementioned restructuring institution should be examined and approved by its Workers Congress or trade union organization.

    Fosun Pharma (stock code: 600196-SH, 02196-HK), established in 1994, is a leading healthcare company in the PRC. As the vanguard of the healthcare service market in China, Fosun Pharma has preliminary established a strategic layout in the segment of healthcare services with high-end healthcare institution represented by United Family Healthcare in the coastal cities and specialty and general hospitals in second-tier and third-tier cities. In recent years, Fosun Pharma has acquired majority shares or underwent equity participation in a number of healthcare service institutions, including Chindex Medical (United Family), Chancheng Hospital, Jimin Oncology Hospital, Guangji Hospital, Zhongwu Hospital, etc. Meanwhile, Fosun Pharma has actively explored opportunities of establishing hospitals with mixed ownership, cooperating with Taizhou Municipal Hospital and Wenzhou TCM Hospital successively, further improved its regional deployment.

News source: FosunPharma


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