Tianjin China Merchants Tianhe Pharmaceutical Technology Development Partnership (L.P) entered into cooperation agreement to acquire 18.5% stake in Tianjin Institute of Pharmaceutical Research Co., Ltd from Tianjin Development Holdings Limited (SEHK:882) for approximately CNY 400 million on August 6, 2018. Under the terms, the consideration is paid in cash within 5 business days from the date following the date of the cooperation agreement. Prior to signing of the cooperation agreement, Tianjin China Merchants Tianhe Pharmaceutical Technology Development Partnership (L.P) has paid a security deposit of CNY 350 million and such amount has been applied as part payment of the consideration for the transaction upon signing of the cooperation agreement. In related transaction, Tianjin China Merchants Tianhe Pharmaceutical Technology Development Partnership (L.P) entered into cooperation agreement to inject an aggregate sum of CNY 1 billion by way of cash contribution into Tianjin Institute of Pharmaceutical Research Co., Ltd, in which, CNY 33.9 million will be contributed as the additional registered capital and the balance of CNY 970.1 million will be contributed towards the capital reserve of Tianjin Institute of Pharmaceutical Research Co., Ltd. Upon Completion, Tianjin Institute of Pharmaceutical Research Co., Ltd will be held as to 35% and 65% respectively by Tianjin Development Holdings Limited and Tianjin China Merchants Tianhe Pharmaceutical Technology Development Partnership (L.P) and the total registered capital of Tianjin Institute of Pharmaceutical Research Co., Ltd will be increased from CNY 39 million to CNY 72.9 million. Tianjin Institute of Pharmaceutical Research Co., Ltd will cease to be a subsidiary and become an associate of the Tianjin Development Holdings Limited. For the year ended December 31, 2017, Tianjin Institute of Pharmaceutical Research Co., Ltd reported net assets of CNY 582.43 million and profit after tax of CNY 15.8 million. On September 10, 2018, the transaction is approved by Board of Directors of Tianjin Development Holdings Limited and recommended the shareholders to approve the agreement. Tianjin Development Holdings Limited intends to apply the net proceeds from transaction as general working capital of the Tianjin Development Holdings Limited and its subsidiaries. Tongzhixingde (Beijing) Assets Appraisal Co. Ltd acted as valuer for Tianjin Institute of Pharmaceutical Research Co., Ltd. Tianjin China Merchants Tianhe Pharmaceutical Technology Development Partnership (L.P) completed the acquisition of 18.5% stake in Tianjin Institute of Pharmaceutical Research Co., Ltd from Tianjin Development Holdings Limited (SEHK:882) on October 31, 2018.