Resuming trading on Wednesday! Baihua Pharmaceutical plans to welcome a new state-owned investor

On the evening of April 7, Beijing Huayuan Pharmaceutical (600721) announced that its controlling shareholder and actual controllers, Mi Zaiqi, Mi Enhua, Yang Xiaoling, and the Jinhua City Juxin Enterprise Management Partnership (Limited Partnership) (abbreviated as “Jinhua Juxin”) signed a “Share Transfer Agreement,” proposing to transfer, by agreement, the total 20.68% of the company’s shares they hold to Jinhua Juxin at a price of RMB 890 million. After completion of this transaction, the company’s controlling shareholder will be changed to Jinhua Juxin, and the actual controllers will be changed to the Jinhua City People’s Government State-owned Assets Supervision and Administration Commission. After the company applied to the Shanghai Stock Exchange, the company’s shares will resume trading starting from the opening of trading on April 8.

If the transaction is successful, Beijing Huayuan Pharmaceutical will be transformed from a private enterprise into a state-owned enterprise. In addition, the new controlling party with a state-owned assets background, Jinhua Juxin, plans to acquire this equity at a premium. According to the announcement, the transaction price corresponds to RMB 11.19 per share, which is higher than the closing price of RMB 10.18 per share on the last trading day prior to Beijing Huayuan Pharmaceutical’s trading suspension on March 30, representing a premium of 9.92%.

The announcement shows that Jinhua Juxin was established on September 23, 2025. Its business scope includes enterprise management, enterprise management consulting, information consulting services, and so on. The company’s paid-in capital contribution is RMB 800 million. Behind it, there are four partners: Jinhua Zhihui Enterprise Management Co., Ltd. (abbreviated as “Jinhua Zhihui”), Zhejiang Shanchuan River Valley Technology Co., Ltd., Jinhua Jintou Group Co., Ltd., and Hangzhou Shanhai Yiyi Investment Partnership (Limited Partnership), invested with its own funds. Among them, Jinhua Jintou Group Co., Ltd. has a subscribed capital contribution of RMB 563 million, representing a 70.37% contribution ratio. The actual controller behind that company is the Jinhua City State-owned Assets Supervision and Administration Commission.

However, the execution affairs partner is Jinhua Zhihui, which has a capital contribution of only RMB 100,000 (a contribution ratio of 0.0125%). According to the partnership agreement of Jinhua Juxin, the execution affairs partner shall execute the affairs of the partnership and represent the enterprise externally. Jinhua Juxin will establish an Investment Decision Committee, responsible for reviewing and making resolutions on project investment decisions and exit decisions. The Investment Decision Committee consists of 3 members. Of these, 2 members are appointed by Jinhua Zhihui. The decision-making rules of the Investment Decision Committee require that major matters must be approved by more than two-thirds (including the number itself) for a decision to be made. Therefore, Jinhua Zhihui is the partner that holds control over Jinhua Juxin, and the actual controller is the Jinhua City State-owned Assets Supervision and Administration Commission.

Beijing Huayuan Pharmaceutical is a comprehensive service CRO company featuring “pharmaceutical research + clinical services + biological analysis and testing.” Its business covers early discovery and screening of new drugs, pharmaceutical CMC development, clinical trials, registration and filing, BE/PK biological sample analysis and pharmaceutical testing services, clinical SMO and data services, MAH services, as well as API and intermediate production and supply, among others. In 2025, the company achieved total operating revenue of RMB 388 million, up 0.66% year over year; net profit attributable to shareholders was RMB 40.6879 million, down 1.91% year over year.

It is worth noting that at the end of December 2025, the company’s actual controller had also planned a control transfer. However, because the controlling shareholder, actual controller, and the transaction counterparty did not reach a consensus on major matters related to the change in control, the planned control transfer-related matters were terminated.

In response to this new round of ownership transfer plan, Beijing Huayuan Pharmaceutical stated that after the completion of this equity change, Jinhua Juxin will fully leverage industrial synergy to empower the development of the listed company’s business. It will further enhance the listed company’s industrial competitiveness and profitability and improve the value of the listed company, in accordance with the principles of benefiting the listed company’s sustainable development and protecting the rights and interests of all shareholders. Jinhua Juxin and the execution affairs partner, Jinhua Zhihui Enterprise Management Co., Ltd., have no explicit plan or arrangement in the next 36 months to conduct major asset restructuring of the listed company and its controlling subsidiaries.

It is understood that Jinhua City has a relatively large pharmaceutical industry cluster, and it is currently actively fostering the development of the biopharmaceutical industry. The “High-Quality Development Plan for the Biopharmaceutical Industry Chain in Jinhua City (2024–2027)” shows that Jinhua City strives to achieve zero breakthroughs in the national approval of innovative drug devices within three years, zero breakthroughs in the 100-billion-yuan biopharmaceutical industry cluster, and breakthroughs by more than 10 biopharmaceutical enterprises with annual output value of more than RMB 1 billion; newly added project investment landing in the biopharmaceutical industry of the whole city exceeds RMB 100 billion; transaction value in the traditional Chinese medicine materials market exceeds RMB 100 billion; and the added biopharmaceutical industry output value in Jinhua City increases by RMB 100 billion. By 2027, Jinhua City plans for the scale of above-designated industrial output value in its biopharmaceutical industry to exceed RMB 36 billion.

Recently, the state-owned assets of Jinhua City also plans to participate in the restructuring of Beingmei. In March 2026, Beingmei announced that it will be restructured by investors with a Jinhua state-owned assets background, further optimizing its asset structure. Beingmei’s business includes the R&D, production, and sales of infant and child food and parent-child products, involving areas such as parent-child family life, parent-child services, parent-child health, and parent-child education.

(Source: Shanghai Securities News)