Hubei Mailyard Share Co.,Ltd (SHSE:600107) entered into purchase asset framework agreement to acquire 56.6% stake in Gansu Zhongyou Health Pharmaceutical Co., Ltd. from Gansu Zhongyou Health Management Group Co., Ltd., Zhejiang Zhongheyou Trading Co., Ltd. and Zhejiang Free Trade Zone Huicheng Rongtong Project Investment Partnership (Limited Partnership) for CNY 1.7 billion on July 10, 2020. According to the "Purchase Asset Framework Agreement", the cash consideration is CNY 850 million. Based on the calculation of the consideration of the shares and the price of the shares issued, the number of shares issued to purchase assets for this issue is tentatively set at 92,198,581 shares. The final transaction amount will be based on the appraisal value stated in the relevant appraisal report issued by the appraisal agency with securities and futures business qualifications in the target company, and will be determined through negotiation between the parties to the transaction. Of the cash consideration of CNY 850 million, the cash consideration of CNY 200 million will be paid by the company to the counterparties within 10 working days from the effective date of the formal agreement of the transaction; the cash consideration of CNY 350 million will be delivered by the company within 30 working days after the matching funds are raised; the cash consideration of CNY 300 million will be paid in installments. If the actual net profit of the target company’s performance commitment period is higher than the promised net profit, the company should be oriented as follows: the counterparty pays the remaining cash consideration of CNY 300 million in five times, as follows; within 20 working days after the issuance of the "Special Audit Report" for the achievement of the target company's performance commitment in 2020 the company will pay CNY 60 million; within 20 working days after the issuance of the "Special Audit Report" for the achievement of the target company's performance commitment in 2021 the company will pay CNY 60 million; within 20 working days after the issuance of the "Special Audit Report" for the achievement of the target company's performance commitment in 2022 the company will pay CNY 60 million; within 20 working days after the issuance of the "Special Audit Report" for the achievement of the target company's performance commitment in 2023 the company will pay CNY 60 million; within 20 working days after the issuance of the “Special Audit Report” for the achievement of the target company’s performance commitment in 2024 the company will pay CNY 60 million. The target company is undergoing a capital increase process. After the capital increase, the total share capital of the target company shares will be changed to 622.26 million shares. After the transaction is completed, Hubei Mailyard will hold 50% of the total share capital after the capital increase of the target company, and the target company will become the controlled subsidiary of Hubei Mailyard. Hubei Mailyard intends to raise supporting funds from the non-public offering of shares, Shanghai Chixin Investment Co., Ltd. is the subscriber of supporting funds. Shanghai Chixin Investment Co., Ltd. is a company controlled by the actual controller of the company. The purpose of raising the matching funds is to pay the cash consideration for this transaction. The total amount of funds raised is CNY 400 million, which does not exceed 100% of the price of the assets purchased by the shares issued in this transaction. As at year ended December 31, 2019, Gansu Zhongyou Health Pharmaceutical had total assets of CNY 4.77 billion and net assets of CNY 1.19 billion. For the year ended December 31, 2019, Gansu Zhongyou Health Pharmaceutical had revenues of CNY 4.27 billion and net profit of CNY 322.6 million. The transaction is subject to approval from the Hubei Mailyard Share Co., Ltd's shareholders' general meeting, apart from the counterparty to the transaction, some minority shareholders of the target company need to give up their preemptive right to purchase the target asset, after the relevant auditing and evaluation of the target company involved in this exchange is completed, the company once again convenes the Board of Directors to review the formal plan of the transaction and approval from the China Securities Regulatory Commission. On July 10, 2020, Hubei Mailyard Share convened the fifth meeting of the eleventh Directorate and reviewed and approved the resolution related to the restructuring plan of the transaction. Hubei Mailyard Share Co.,Ltd (SHSE:600107) cancelled the acquisition of 56.6% stake in Gansu Zhongyou Health Pharmaceutical Co., Ltd. from Gansu Zhongyou Health Management Group Co., Ltd., Zhejiang Zhongheyou Trading Co., Ltd. and Zhejiang Free Trade Zone Huicheng Rongtong Project Investment Partnership (Limited Partnership) on July 3, 2021.