Shanghai Fosun Pharmaceutical : CONNECTED TRANSACTION - FORMATION OF PARTNERSHIP（H SHARE）

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上 海 復 星 醫 藥（ 集 團 ）股 份 有 限 公 司

Shanghai Fosun Pharmaceutical (Group) Co., Ltd.*

(a joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 02196)

CONNECTED TRANSACTION

FORMATION OF PARTNERSHIP

FORMATION OF PARTNERSHIP

The Board announces that, on 23 October 2020, Fujian Fund, the subsidiary of the Company, the Company, Fosun High Tech, the controlling shareholder of the Company, and Xinghui Anying entered into the Nanjing Partnership Agreement, pursuant to which, the total capital contribution of the Nanjing Partnership shall be RMB10 million, of which RMB0.1 million shall be contributed by Fujian Fund (as the General Partner), RMB4.44 million shall be contributed by the Company (as a Limited Partner), RMB2.96 million shall be contributed by Fosun High Tech (as a Limited Partner) and RMB2.50 million shall be contributed by Xinghui Anying (as a Limited Partner).

HONG KONG LISTING RULES IMPLICATIONS

As the date of this announcement, Fosun High Tech is the controlling shareholder of the Company. Accordingly, Fosun High Tech constitutes a connected person of the Company under Rule 14A.07 of the Hong Kong Listing Rules. Therefore, the entering into of the Nanjing Partnership Agreement constitutes a connected transaction of the Company under Chapter 14A of the Hong Kong Listing Rules.

Given that the party to the Nanjing Partnership Agreement is the same connected person as the relevant parties to the Previous Transactions, the transaction contemplated under the Nanjing Partnership Agreement and the Previous Transactions shall be aggregated pursuant to Rule 14A.81 of the Hong Kong Listing Rules. As the highest percentage ratio applicable to the sum of the transactions contemplated under the Nanjing Partnership Agreement and the Previous Transactions is more than 0.1% but less than 5%, the transaction contemplated under the Nanjing Partnership Agreement is subject to reporting and announcement requirements but is exempt from the independent shareholders' approval requirement under Chapter 14A of the Hong Kong Listing Rules.

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1. NANJING PARTNERSHIP AGREEMENT
   The Board announces that, on 23 October 2020, Fujian Fund, the subsidiary of the Company, the Company, Fosun High Tech, the controlling shareholder of the Company, and Xinghui Anying entered into the Nanjing Partnership Agreement, pursuant to which, the total capital contribution of the Nanjing Partnership shall be RMB10 million, of which RMB0.1 million shall be contributed by Fujian Fund (as the General Partner), RMB4.44 million shall be contributed by the Company (as a Limited Partner), RMB2.96 million shall be contributed by Fosun High Tech (as a Limited Partner) and RMB2.50 million shall be contributed by Xinghui Anying (as a Limited Partner).
   Date
   23 October 2020 Parties
2. 1. Fujian Fund；
   2. The Company；
   3. Fosun High Tech; and
   4. Xinghui Anying

Capital contribution and payments

The total capital contribution to be made by all partners of the Nanjing Partnership shall be RMB10 million. The capital contribution to be made by each of the partners is set out as follows:

				Approximate
				percentage
				of interest in
		Capital	Nanjing
Partners	Type	Contribution	Partnership
		(RMB million)
Fujian Fund	General Partner	0.10		1%
The Company	Limited Partner	4.44		44.4%
Fosun High Tech	Limited Partner	2.96		29.6%
Xinghui Anying	Limited Partner	2.50		25%
Total		10.00		100.0%

Each of the partners of Nanjing Partnership shall make its respective capital contribution in full by 31 December 2026.

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The capital contribution to be made by the partners of Nanjing Partnership was determined after arm's-length negotiation between the partners taking into account of the capital requirements of the Nanjing Partnership. The relevant capital contribution will be financed by the self-owned funds of Fujian Fund and the Company, respectively.

Scope of business

Entrepreneur investment, equity investment, investment with self-owned fund, management of the asset invested with self-owned fund, corporate management, corporate management consulting and information consulting service (for items which required license according to the law, its operation shall only commence after obtaining the approval from relevant authorities) (subject to the approval of registration authorities).

Business of the partnership

Fujian Fund, the General Partner, shall act as the executive partner of the Nanjing Partnership to represent Nanjing Partnership and execute the business of Nanjing Partnership.

Profit and loss of the partnership

The profit and loss of Nanjing Partnership shall be distributed and assumed by the partners in proportion to their respective paid-up contribution.

Debt of the partnership

Nanjing Partnership shall apply the property of partnership in payment of its debts and liabilities. The General Partner shall bear unlimited liability for Nanjing Partnership in case of insufficient property, and the Limited Partners shall be liable for the debts and liabilities of Nanjing Partnership in proportion, and limited, to their respective subscription amount of contribution.

Dispute resolutions

Any dispute between the partners shall be resolved through negotiation, failing which a legal proceeding may be brought to the people's court where Nanjing Partnership is located.

Effectiveness

The Nanjing Partnership Agreement shall become effective upon signing, or affixing with common seal, by all partners thereto.

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1. REASONS AND BENEFITS OF THE FORMATION OF NANJING PARTNERSHIP
   In order to strengthen the composition of the healthcare industry, the Group intends to consolidate internal and external resources and initiate the establishment of equity investment funds to invest projects in areas including, among others, biomedicine, medical device and diagnosis, biomaterial and precision treatment. Nanjing Partnership is an investment and management platform established by the Group to initiate the establishment of equity investment funds.
   The Nanjing Partnership will be incorporated to the consolidated statement of the Group.
   The Directors (including the independent non-executive Directors) consider that the terms of the Nanjing Partnership Agreement are on normal commercial terms, and are fair and reasonable and in the interests of the Company and the Shareholders as a whole.
   Mr. Chen Qiyu, Mr. Yao Fang, Mr. Xu Xiaoliang, Mr. Gonping, Mr. Pan Donghui and Mr. Zhang Houlin, being Directors, abstained from voting on the resolution of the Board in respect of the entering into of the Nanjing Partnership Agreement, while the 5 remaining Directors (including 4 independent non-executive Directors) participated in the voting and approved unanimously.
2. INFORMATION OF PARTNERS Fujian Fund
   Fujian Fund is a company established in the PRC with limited liability and a non-wholly owned subsidiary of the Company. Its scope of business mainly includes the equity investment management in the innovation area of healthcare medical industry and Fujian Fund has completed the registration in the Asset Management Association of China.
   The Group
   The Group is a leading healthcare group in the PRC and primarily engaged in business segments including pharmaceutical manufacturing, research and development, medical devices and medical diagnosis, healthcare services as well as pharmaceutical distribution and retail.
   Fosun High Tech
   Fosun High Tech is a company established in the PRC with limited liability and the controlling shareholder of the Company. Fosun High Tech is a wholly-owned subsidiary of Fosun International Limited (a company listed on the main board of the Hong Kong Stock Exchange with the stock code 00656), it mainly focuses on health, happiness and wealth businesses and provides high-quality products and services for families around the world.

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