(Yicai) Aug. 5 -- China Resources Sanjiu Medical & Pharmaceutical, a key maker of traditional Chinese medicines under conglomerate China Resources Corporation, said it will take control of Tasly Pharmaceutical Group in a CNY6.2 billion (USD869 million) deal.

CR Sanjiu will buy 418 million shares, representing a 28 percent stake, in Tasly from Tasly Great Health Industry Investment Group for CNY14.85 (USD2.08) apiece, it said yesterday. Tasly Great Health will also transfer a 5 percent stake to CR Sanjiu's major shareholder Guoxin Investment.

Shenzhen-based CR Sanjiu has undertaken 15 expansions, mergers, and acquisitions since 2008.

Shares of CR Sanjiu [SHE: 000999] closed 0.7 percent higher at CNY42.34 (USD5.93) apiece in Shenzhen today. Tasly [SHA: 600535] jumped 5.7 percent to CNY14.88 in Shanghai.

After completing the transactions, Tasly founder Yan Xijun and his family will still own more than 17 percent of the company but will no longer be the actual controllers, CR Sanjiu noted, adding that the acquisition will help consolidate its leading position, increase core competitiveness, and enhance the TCM supply chain by fully integrating the pair's resources.

China Resources Pharmaceutical Group, also under CRC, and Tasly Great Health inked a deal to cooperate in TCM's innovative development, a Tasly large language model for the industry, and dropping pill technology and equipment yesterday.

CR Sanjiu will solve horizontal competition issues within five years of finishing the transactions, it said.

Established in 1994, Tianjin-based Tasly makes cardiovascular and cerebrovascular, digestion and metabolism, cancer, biomedicine, pharmaceutical chemicals, and other products and has branched out into tea drinks, bottled water, and wines.

For the first quarter of this year, Tasly had a net profit of CNY295 million (USD41.4 million) on operating revenue of CNY2 billion. Last year, the company reported a net profit of CNY1.1 billion versus a loss of CNY341 million in 2022 after revenue rose 0.4 percent to CNY8.7 billion.

CR Sanjiu's predecessor Southern Pharmaceutical Factory was set up in 1985, with CRC taking over in 2008. It mainly focuses on consumer healthcare and prescription drugs and has 39 products, each reaching sales of over CNY100 million last year. Its net profit rose 16.5 percent to CNY2.9 billion and its operating revenue jumped 37 percent to CNY24.7 billion (USD3.5 billion).

Editor: Martin Kadiev