China-based Sinobiomed's subsidiary, Shanghai Wanxing Bio-pharmaceuticals has signed a formal Equity Transfer Contract on August 6, 2007 with the equity owners of Suzhou Boai Medical Development Company to acquire 90 percent interest in Suzhou Boai, a pharmaceutical distribution firm.
Under the contract, all the equity owners of Suzhou Boai will transfer all of their equity to Shanghai Wanxing, except for one equity owner who will retain a 10 percent interest, for a transfer price of approximately $2.4 million. With this acquisition, Shanghai Wanxing will gain control of Suzhou Boai's GSP certified facility.
The pharmaceutical distribution company, located in Suzhou, about 100 km east of Shanghai, has two wholly owned subsidiaries; one sells vaccines, the other medical devices. Suzhou Boai is engaged in the wholesale supply of biological products, chemical medicines and Chinese traditional medicine in southern and east central China.
"The acquisition of Suzhou Boai's well developed product distribution network – in combination with Shanghai Wanxing's robust product pipeline and GMP certification – is expected to accelerate and expand sales and revenue," said Shanghai Wanxing;s President and CEO, Mr Banjun Yang. "We intend to build on Suzhou Boai's current customer base as well as widen our market penetration in China."
The acquisition of Suzhou Boai is the first step of Sinobiomed's expansion strategy. The Company intends to acquire another distributor in northern China, as well as target pharmaceutical companies with manufacturing capability and existing product lines for acquisition. Sinobiomed's near-term objective is to develop a large-scale, highly profitable integrated pharmaceutical enterprise that develops, manufactures and distributes a broad range of market-driven products that leverage its innovative biotechnology patents and processes.