LUYE PHARMA (02186): Nanjing Xingshi plans to acquire 25% equity of Nanjing Luye for 1.086 billion yuan.

LUYE PHARMA (02186) announced that on December 25, 2025, Nanjing Green Leaf (a subsidiary of the company), the withdrawing investor (Shenzhen Green Leaf Private Equity Investment Fund Partnership Enterprise (Limited Partnership)), and Nanjing Xinshi entered into a share transfer agreement. According to this agreement, the withdrawing investor agreed to transfer its 25% equity stake in Nanjing Green Leaf to Nanjing Xinshi for RMB 1.086 billion. Nanjing Xinshi is a limited partnership. In October 2025, Shandong Green Leaf (a wholly-owned subsidiary of the company) subscribed to approximately 33.2% of the partnership equity of Nanjing Xinshi for RMB 200 million as a limited partner according to the partnership agreement. The remaining equity of Nanjing Xinshi is held by CHINA CINDA as another limited partner with approximately 66.4% stake, and Hangzhou Xinshi and Yantai Hesin as ordinary partners each holding approximately 0.2% stake. In connection with the proposal by Nanjing Xinshi to acquire the withdrawing investor's 25% equity stake in Nanjing Green Leaf, the group has entered into a series of further transactions: - According to the Nanjing Green Leaf Equity Option Agreement, Nanjing Xinshi is authorized to demand Yantai Green Leaf to repurchase the equity stake held by Nanjing Xinshi in Nanjing Green Leaf upon the occurrence of specified events. - According to the partnership agreement, Nanjing Xinshi must make semi-annual distributions to CHINA CINDA. Under the Nanjing Xinshi Partnership Equity Option Agreement, if Nanjing Xinshi fails to make any such distributions by the due date, Yantai Green Leaf must pay any shortfall to CHINA CINDA. - According to the Nanjing Xinshi Partnership Equity Option Agreement, Yantai Green Leaf has the right to require CHINA CINDA to sell its stake in Nanjing Xinshi to Yantai Green Leaf. If Yantai Green Leaf exercises its subscription option, it must purchase Hangzhou Xinshi's partnership equity in Nanjing Xinshi. - According to the Nanjing Xinshi Partnership Equity Option Agreement, CHINA CINDA has the right to require Yantai Green Leaf to purchase all of CHINA CINDA's partnership equity in Nanjing Xinshi upon the occurrence of specified events. If CHINA CINDA exercises its put option, Yantai Green Leaf must also purchase Hangzhou Xinshi's partnership equity in Nanjing Xinshi. The company and Shenzhen Green Leaf have agreed jointly and severally to guarantee CHINA CINDA and Hangzhou Xinshi to ensure Yantai Green Leaf's proper performance of all obligations under the Nanjing Xinshi Partnership Equity Option Agreement. After the completion of the share transfer, Nanjing Xinshi will obtain bank financing of up to RMB 648 million. Yantai Green Leaf and Shenzhen Green Leaf will provide guarantees for the related bank financing. As of the date of this announcement, Nanjing Green Leaf is owned 75% by Shenzhen Green Leaf and 25% by the withdrawing investor. Nanjing Green Leaf and its subsidiaries are mainly engaged in the production and sale of pharmaceuticals, focusing on the field of tumor treatment. The directors believe that the purpose of the proposed transactions under the transaction agreement is to introduce third-party investors to provide financing and support in order to provide funds for the repurchase amount required for the share transfer. These arrangements are intended to ensure timely and effective access to the necessary funds to purchase the 25% stake in Nanjing Green Leaf.