Honk Kong–based Golden Meditech Holdings has agreed to sell its 65.4% equity stake in China Cord Blood Corporation (CCBC) to the merger and acquisition fund Nanjing Yingpeng Huikang Medical Industry Investment Partnership for RMB5.764 billion ($0.83 billion). Golden Meditech and Yingpen Huikang Fund have entered a sale and purchase agreement for the transaction, and Golden Meditech says it will host an extraordinary general meeting for its shareholders to approve the deal.
As part of the purchase agreement, Golden Meditech will also give Yingpen Huikang Fund a 3-year performance guarantee for CCBC, backed by a cash compensation should CCBC demonstrate an earnings shortfall during the 3 years. Golden Meditech says it will use the capital from the sale of CCBC for diversification and to consolidate its healthcare services platform and expand its medical and healthcare businesses.
CCBC is a subsidiary of Golden Meditech and claims to be the first and largest umbilical cord blood banking organization in China. Primary activities include the provision of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services.
Golden Meditech is an integrated healthcare enterprise operating in the medical devices, cord blood storage, and hospital management markets. In September 2016, Golden Meditech and the University of Texas at MD Anderson Cancer Center reported jointly setting up a new Houston-based company, Cellenkos, which aims to develop umbilical cord blood-derived T-regulatory cell therapies.