Livzon Pharmaceutical Group Inc. (Livzon Pharma) announced on 21 August 2026 that it has signed a share-transfer agreement to acquire an additional 3.50% equity interest in its active pharmaceutical ingredient subsidiary, Livzon Group Xinbeijiang Pharmaceutical Co., Ltd. (Xinbeijiang Pharma), from employee shareholding platform Zhuhai Zhong Hui Yuan Investment Partnership (Limited Partnership).

The cash consideration totals RMB106.70 million and corresponds to RMB8.41 million of Xinbeijiang Pharma’s registered capital. Post-transaction, Livzon Pharma’s direct ownership will rise to 90.64% from 87.14%, while Zhong Hui Yuan’s stake will fall to 4.93% from 8.44%. Payment is scheduled within five business days after completion and will be funded entirely by Livzon Pharma’s internal resources.

Pricing was determined through arm’s-length negotiations, benchmarked against Xinbeijiang Pharma’s net assets of RMB3.04 billion as at 31 December 2025 (prepared under PRC GAAP). Xinbeijiang Pharma generated profit before tax of RMB770.80 million and net profit of RMB529.95 million in 2025, following RMB742.85 million and RMB521.15 million respectively in 2024. For the six months ended 30 June 2026, profit before tax reached RMB389.45 million, with net profit of RMB268.69 million; net assets stood at RMB3.32 billion.

Livzon Pharma stated that the transaction will streamline the subsidiary’s equity structure, enhance control over its core API business and improve operational decision-making efficiency. Management expects no material impact on the group’s current or future financial position and operations. Xinbeijiang Pharma will remain a consolidated, non-wholly-owned subsidiary after completion.

Regulatory framework: Because Zhong Hui Yuan is an associate of Livzon Pharma executive director Mr. Tang Yanggang, the deal is classified as a connected transaction under Chapter 14A of Hong Kong’s Listing Rules. With applicable percentage ratios exceeding 0.1% but below 5%, the acquisition requires public disclosure but is exempt from independent shareholders’ approval.