Announcements and Notices - Completion of Connected Transactions: (1) Acquisition of Minority Interest in A Non-wholly Owned Subsidiary; and (2) Issue of New Shares by the Company

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities of the Company.

China Grand Pharmaceutical and Healthcare Holdings Limited 遠大醫藥健康控股有限公司*

(Incorporated in Bermuda with limited liability)

(Stock Code: 00512)

COMPLETION OF CONNECTED TRANSACTIONS

(1) ACQUISITION OF MINORITY INTEREST IN A NON-WHOLLY OWNED

SUBSIDIARY; AND

(2) ISSUE OF NEW SHARES BY THE COMPANY

The Board is pleased to announced that the Acquisition was completed on 8 December 2017 and the Subscription was completed on 15 January 2018 in accordance with the Acquisition Agreement and the Subscription Agreement.

A total of 47,750,000 Subscription Shares have been successfully allotted and issued to Zhonghai Trust Company Limited, being the trustee holding the Subscription Shares for the Vendor.

Reference is made to the announcement of China Grand Pharmaceutical and Healthcare Holdings Limited (the "Company") dated 10 October 2017 (the "Announcement") and the circular dated 17 November 2017 in relation to, among other things, the Acquisition and the Subscription.

Capitalised terms used in this announcement have the same meanings as those defined in the Announcement unless the context requires otherwise.

COMPLETION OF ACQUISITION AND SUBSCRIPTION

The Board is pleased to announced that with all the conditions of the Acquisition and the Subscription having been fulfilled, the Acquisition was completed on 8 December 2017 and the Subscription was completed on 15 January 2018 in accordance with the Acquisition Agreement and the Subscription Agreement.

A total of 47,750,000 Subscription Shares have been successfully allotted and issued to Zhonghai Trust Company Limited, being the trustee holding the Subscription Shares for the Vendor.

The net proceeds of the Subscription of approximately HK$107.0 million will be used as to approximately HK$90.0 million for repayment of bank loans; approximately HK$9.9 million for repayment of interest of convertible bonds; approximately HK$1.7 million for salary and wages; approximately HK$0.8 million for office rent; approximately HK$3.2 million for audit fees and other professional expenses; and approximately HK$1.4 million for other recurring operating expenses.

CHANGES ON THE SHAREHOLDING STRUCTURE OF THE COMPANY

The 44,570,000 Subscription Shares represent (i) approximately 2.13% of the issued share capital of the Company as at the date of the Subscription Agreement; and (ii) approximately 2.09% of the issued share capital of the Company as enlarged by the allotment and issue of the Subscription Shares.

The shareholding structures of the Company (i) immediately before the completion of the Subscription; and (ii) upon the completion of the Subscription, are as follows:

Immediately before completion of the SubscriptionImmediately after completion of the Subscription

Number of Shares held

Approximate percentage of total issued share capital

Number of Shares held

Approximate percentage of total issued share capital

Outwit Investments Limited ("Outwit")

1,311,831,572

58.64% 1,311,831,572 57.42%

(Note 1)

East Ocean Capital (Hong Kong) Company Limited ("East Ocean")

24,916,943

1.11%

24,916,943 1.09%

(Note 2)

Shanghai Grand Financial Investment Co., Ltd.

14,558,000

0.66%

14,558,000 0.63%

("Shanghai Financial")

(Note 2)

Shao Yan (Note 3)

4,790,000

0.21%

4,790,000 0.21%

Sub-total

1,356,096,515

60.62% 1,356,096,515 59.35%

Public Shareholders

Vendor

-

Other public Shareholders

880,915,794

- 39.38%

47,750,000 2.09%

880,915,794 38.56%

Total

2,237,012,309

100.00% 2,284,762,309 100.00%

Notes:

• 1. Outwit is the beneficial owner of 1,311,831,572 Shares. Grand (Hongkong) International Investments Holdings Limited ("Grand Investment") holds 60% equity interests of Outwit, and Ms Chau Tung (the spouse of Mr Hu) holds the remaining 40% equity interests. Grand Investment is wholly-owned by China Grand Enterprises Incorporation ("China Grand"), which in turn is controlled and ultimately and beneficially owned by Mr Hu.

• 2. Shanghai Financial is a direct non-wholly owned subsidiary of China Grand, and East Ocean is wholly owned by Shanghai Financial.

• 3. Dr Shao Yan, a Director, is the spouse of Ms Tian Wen Hong, who is the holder of the above shares.

By Order of the Board China Grand Pharmaceutical and

Healthcare Holdings Limited

Liu Chengwei

Chairman

Hong Kong, 15 January 2018

As at the date of this announcement, the Board comprises four executive directors, namely Mr Liu Chengwei, Mr Hu Bo, Dr Shao Yan and Dr Niu Zhanqi and three independent non-executive directors, namely Ms So Tosi Wan, Winnie, Mr Lo Kai Lawrence and Dr Pei Geng.

* For identification purposes only