Shanghai Fosun Pharmaceutical raises shareholding in Tongjitang

Published: 23 Jun 2009 22:50:37 PST

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Jun. 24, 2009 (China Knowledge) - Shanghai Fosun Pharmaceutical (Group) Co Ltd<600196> recently raised its shareholding in Tongjitang Chinese Medicines Co (Tongjitang)<TCM> to 20.02%, according to a statement Shanghai Fosun Pharmaceutical filed with the Shanghai Stock Exchange.

Shanghai Fosun Pharmaceutical, through its subsidiary Fosun Industrial (Hong Kong) Ltd Co, bought 6.77 million American Depositary Shares (ADS) of Tongjitang for US$21.66 million in the secondary market.

Shanghai Fosun Pharmaceutical said that the share acquisition is for investment, which is the same reason that the company has raised its shareholding in Tongjitang 12 times in the past eight months.

However, some analysts in the pharmaceutical industry have said Shanghai Fosun Pharmaceutical is aiming to take control of Tongjitang to delist the company, integrate both firms' Chinese traditional medicine businesses, and finally list on the A-share market.

Tongjitang launched an IPO on the New York Stock Exchange in 2007. As of Dec. 31, 2008, the firm had 135 million outstanding common shares.

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