Luye Pharmaceutical (02186): Nanjing Xinshi plans to acquire 25% of Nanjing Luye's shares for 1,086 billion yuan

Zhitong Finance App News, Luye Pharmaceutical (02186) announced that on December 25, 2025, Nanjing Luye (a subsidiary of the company), the divested investor (Shenzhen Luye Private Equity Investment Fund Partnership (limited partnership)) and Nanjing Xinshi signed an equity transfer agreement. Based on this, the divested investors agreed to transfer 25% of their shares in Nanjing Luye to Nanjing Xinshi for RMB 1,086 billion. Nanjing Xinshi is a limited partnership. In October 2025, Shandong Luye (a wholly-owned subsidiary of the company), as a limited partner, subscribed for about 33.2% of Nanjing Xinshi's partnership interests at RMB 200 million under a partnership agreement. Nanjing Xinshi's remaining interests are held by China Cinda as another limited partner, and Hangzhou Xinshi and Yantai Hexin each hold approximately 0.2% of the partnership's interests as general partners.

Regarding Nanjing Xinshi's proposal to acquire 25% of the divested investors' shares in Nanjing Luye, the Group has entered into a series of further transactions:

According to the Nanjing Luye equity option agreement, Nanjing Xinshi was granted the right to request Yantai Luye to repurchase shares held by Nanjing Luye in the event of a specified incident.

According to the partnership agreement, Nanjing Xinshi is required to distribute to China Cinda for half a year. According to the Nanjing Xinshi partnership equity option agreement, if Nanjing Xinshi fails to pay any such distribution at maturity, Yantai Luye must pay any difference to China Cinda.

According to the Nanjing Xinshi partnership equity option agreement, Yantai Luye has the right to require China Cinda to sell its interest in Nanjing Xinshi to Yantai Luye. If Yantai Luye exercises the subscription option, it must acquire Hangzhou Xinshi's partnership interests in Nanjing Xinshi.

According to the Nanjing Xinshi partnership option agreement, China Cinda has the right to require Yantai Luye to purchase all of China Cinda's partnership interests in Nanjing Xinshi in the event of a specified incident. When China Cinda exercises China Cinda put options, Yantai Luye must also purchase Hangzhou Xinshi's partnership interests.

The company and Shenzhen Luye have agreed to jointly and individually provide guarantees to China Cinda and Hangzhou Xinshi to ensure that Yantai Luye properly fulfils all of its obligations under the Nanjing Xinshi Partnership Options Agreement.

After the equity transfer is completed, Nanjing Xinshi will receive no more than RMB 648 million in bank financing. Yantai Luye and Shenzhen Luye will provide guarantees for relevant bank financing.

As of the date of this announcement, Nanjing Luye owned 75% and 25% of the divested investors respectively from Shenzhen Luye. Nanjing Luye and its subsidiaries are mainly engaged in pharmaceutical production and sales, focusing on the field of cancer treatment. The director believes that the purpose of the proposed transaction under the transaction agreement is to introduce third party investors to provide financing and support in order to finance the repurchase amount required for the share transfer. The purpose of these arrangements is to ensure that the necessary funds can be obtained in a timely and effective manner to purchase 25% of Nanjing Green Leaf's interest.