CHINA TRADITIONAL CHINESE MEDICINE HOLDINGS CO. LIMITED (Stock Code: 570) has entered into three new agreements relating to continuing connected transactions with China National Pharmaceutical Group Co., Ltd. (CNPGC) and its subsidiary Sinopharm Group Finance for the period from 2026 to 2028. These agreements include the Financial Services (2026-2028) Framework Agreement, the Master Purchase (2026-2028) Agreement, and the Master Supply (2026-2028) Agreement.
Under the Financial Services (2026-2028) Framework Agreement (covering deposit services, loan services, and other financial services), Sinopharm Group Finance will provide services on terms that are no less favorable than those offered by independent financial institutions. The maximum daily deposit balance cap (including accrued interest) is set at RMB900 million for each of the three years ending 31 December 2028.
Through the Master Purchase (2026-2028) Agreement, the Group will purchase various traditional Chinese medicine materials, chemical materials, and relevant services from the CNPGC Group. The proposed annual caps for these purchases are RMB704.1 million, RMB724.6 million, and RMB740.1 million for each of 2026, 2027, and 2028 respectively.
Under the Master Supply (2026-2028) Agreement, the Group will sell pharmaceutical products such as TCM finished drugs and related items to the CNPGC Group, with proposed annual caps at RMB2.73 billion for 2026, RMB2.875 billion for 2027, and RMB3.02675 billion for 2028. The agreements also cover certain leasing services to be provided by the Group.
As CNPGC and Sinopharm Group Finance are connected persons of CHINA TRADITIONAL CHINESE MEDICINE HOLDINGS CO. LIMITED (CNPGC directly holds approximately 33.46% of the total issued shares), these transactions are subject to the reporting, announcement, circular, and independent shareholders’ approval requirements under the Listing Rules. The company will convene an extraordinary general meeting (EGM) at which independent shareholders will vote on the agreements and the corresponding annual caps. CNPGC and its associates will abstain from voting on the relevant resolutions.
A circular providing details on the agreements, along with letters from the Independent Board Committee and the appointed Independent Financial Adviser, is expected to be distributed on or around 16 December 2025. The Board considers these transactions to be in the interest of the company and its shareholders, ensuring a continuity of financial services, procurement of major raw materials, and expanded product distribution channels under stable and cost-efficient arrangements.