Hua Xia Healthcare to Acquire Leading Pharmaceutical & Healthcare Retail Chain in Fujian Province

Hua Xia Healthcare Holdings Limited proposed to acquire Huihao Group, one of the leading distributors and providers of supply chain services for pharmaceutical and healthcare products in Fujian Province, the PRC in terms of scale of operation, distribution network and retail chain and operates the largest national pharmaceutical distribution centre in Fujian Province in terms of scale of operation and centre area.

According to the local government statistics, the total consumer expenditures on healthcare in Fujian Province have steadily increased year-by-year in the past few years with spending of over HK$20 billion in 2008. The healthcare industry in Fujian Province has begun to enjoy a series of favorable socio-economic factors.

Mr. Yung Kwok Leong, Chairman of Hua Xia Healthcare, pointed out: "We expect the Proposed Acquisition, if approved by shareholders, to strategically further strengthen the competitiveness of Hua Xia as a leading provider and supplier of healthcare services and pharmaceutical products in China. With this unique business structure, we will be able to tap the fast growing healthcare market thanks to the healthcare reform supported by the PRC government. In the meantime, we strongly believe that the valuable business opportunities created by this important business acquisition will increase our market share and ultimately improve the profitability of the Group. We expect to reap powerful synergies from our unrivaled expertise in hospital services in China and our potential pharmaceutical arm, which will allow us to capture the enormous market opportunities ahead.

"Looking forward, we plan to strengthen the "Huihao" brand, enhance operational efficiency, enlarge our product portfolio and extend our retail footprint organically. In addition to pushing to increase sales by opening new retail drug stores, we will explore the feasibility of taking on management of the pharmacies in hospitals, which will give us another solid platform for promoting our brand. It is our aspiration to become one of the most influential hospital service and pharmaceutical sales corporations in China and we are confident of bringing handsome returns to shareholders in the long run."

The Proposed Acquisition, if materialized, will allow Huihao Group to tap the fast growing pharmaceutical market in Fujian. Huihao Group is substantially held by Mr. Yung Kwok Leong, Chairman of Hua Xia Healthcare, who is therefore a connected person of the Company.

About Hua Xia Healthcare Holdings Limited

Hua Xia Healthcare Holdings Limited ("Hua Xia Healthcare" or the"Group") is a veteran in healthcare investment and hospital management in China. The Group has proposed to acquire Huihao Group, operator of the largest national pharmaceutical distribution centre in Fujian Province, China in 2010. The acquisition, if eventually approved by shareholders, will allow Hua Xia Healthcare to expand its business portfolio from hospital services to include also pharmaceutical wholesale, distribution and direct sales business, areas that stand well to benefit from the on-going healthcare reforms supported by the PRC government.

For details, please visit: www.huaxia-healthcare.com