China Health Group (00673) terminated the acquisition of limited partnership interests and indirect investment in Hunan Bochuang Science and Technology Construction Industry Investment Fund (limited partnership)

Zhitong Finance App News, China Health Group (00673) issued an announcement. On October 18, 2024, the buyer and the target partner had signed an agreement (termination agreement) to terminate the transaction. According to the agreement, the seller agreed to transfer the partnership interest in the target partnership to the buyer, and the buyer agreed to assume the seller's responsibility to contribute RMB 30 million (contribution) to the registered capital of the target partnership.

The target partnership's main investment is holding a 15% limited partnership interest in the fund. The fund is a limited partnership established in China and focuses on investing in medical devices, biopharmaceuticals and medical services. Assuming that all registered capital of the target partnership has been paid up (including contributions from the buyer), the buyer will have an interest of approximately 4.44% of the total registered capital of the target partnership. In July 2021, the buyer paid RMB 15 million to the target partnership as an advance payment for capital, and the balance of RMB 15 million remains unpaid. According to the termination agreement, the contracting party has agreed that the buyer will no longer be required to make an unpaid investment of RMB 15 million to the target partnership; the advance payment of RMB 15 million for the investment will be refunded to the buyer; and the agreement dated July 5, 2021 will be terminated and no longer valid, and that the contracting party shall not file any claims or further claims against the other party other than those set forth in the termination agreement.

As the Fund has not fully implemented its investment plan in view of the current sluggish market environment, the contracting parties have agreed to terminate the transaction. The directors believe that the termination would be in the overall best interests of the company and shareholders.

The directors believe that the termination will not have a significant adverse impact on the Group's business operations and financial position. The Group intends to use the amount returned by the target partnership as its working capital.