Cathay Capital sells stake in Kunming Shenghuo Pharmaceutical Group
May 4, 2020
Asia
Cathay Capital today announces it sold its stake in Kunming Shenghuo Pharmaceutical to China Resources Sanjiu Medical & Pharmaceutical Co., Ltd., a leading Chinese enterprise in OTC, listed on the Shenzhen Stock Exchange. Cathay Capital had invested in Shenghuo Pharmaceutical in June, 2014 through its Sino-French SME Fund and Cathay Capital II Fund. During the three years between 2014 and 2016 of Cathay Capital holding, the net profit of Shenghuo Pharmaceutical rose nearly three times.
Shenghuo Pharmaceutical, established in 1995, focuses on the manufacture and selling of oral cardiovascular drugs. Its main products include Xuesaitong Soft Capsule and Fibrauretinum Soft Capsule. The firm devotes to the deep processing and comprehensive utilization of the precious Yunnan medicinal herbs “Sanqi”. Shenghuo Pharmaceutical covers three series product line of Chinese medicine, cosmetics and healthy food, and has formed a modern Chinese medicine industry chain, integrating R&D, production and marketing.
Cathay Capital has been actively investing in the health industry, and believes this industry has good market prospects, huge potential and is in rapid development. As a cross-border investment fund, Cathay Capital is also very involved in the development of traditional Chinese medicine and its internationalization. Cathay Capital had been in touch with Shenghuo Pharmaceutical’ two founders from 2011 and decided to invest in June 2014. Cathay’s investment contributed to improve the company’s organizational structure, its equity restructuring, diversify its product portfolio and re-focus on sustainable growth.
Mingpo Cai, President of Cathay Capital Private Equity, said: “During our investment, we have been actively cooperating with Shenghuo Pharmaceutical’s team, advising and helping in terms of corporate governance, business planning, and assisting its flagship Xuesaitong Soft Capsule in passing the clinical trial and registration of the United States FDA, promoting the improvement and landing of its development strategy.”
The merger with China Resources Sanjiu Medical & Pharmaceutical offers new opportunities given the complementarity of the two companies in terms of industrial resources and product coverage. Cathay Capital will continue to monitor the company’s development and keep its focus on the healthcare sector, where we are heavily invested and where we see many companies with significant potential.