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Eu Yan Sang to get up to US$35m from HCare to boost China business
EU Yan Sang International (EYSI) will receive funding of up to US$35 million from HCare Investments Holding Ltd, as the integrative health and wellness company looks to make further inroads in China.
HCare Investments Holding, an investment vehicle managed by CareCapital Advisors, will provide initial funds of US$10 million. To support future business growth, HCare has made available a further sum of up to US$25 million.
Under the deal, EYSI will provide matching funding of US$1 million in the initial stage and a further sum of up to US$2.5 million, the group said in a filing to the Singapore Exchange on Friday.
In return, HCare shall subscribe for new shares issued by Eu Yan Sang China Holdings Ltd (EYSCH). EYSCH is a newly incorporated company which would hold the entire issued share capital of Eu Yan Sang (China Venture) Ltd and Eu Yan Sang Trading (Guangdong) Co Ltd.
The transaction will be completed after satisfying certain conditions, including the entry into licensing and supply agreements.
EYSCH will be the exclusive platform of the Eu Yan Sang brand in China, and shall conduct product research and development, manufacturing, distribution and retailing of TCM-related products, said the group. Robert Eu, chairman of EYSI, and Dai Feng, managing director of HCare, will serve as co-chairmen of EYSCH. The cooperation is expected to fast-track the growth of EYSI's business in China, which contributed one per cent revenue to the group's FY2015 financials, it said.