China Resources to spin off HK unit

State-owned conglomerate China Resources (Holdings) aims to spin off its medical and pharmaceutical operations in Hong Kong over the next three to five years after restructuring two drugmakers, chairman Chen Xinhua said.

China Resources planned to inject China Worldbest Group and Sanjiu Enterprise Group, two debt-laden drugmakers acquired in the past two years, and another pharmaceutical arm, Shandong Dong-e E-jiao, into a new company, Mr Chen said on the sidelines of the National People's Congress session on Saturday.

'After restructuring, our pharmaceutical operations will be run under our new subsidiary China Resources Medications Group,' he said.

The conglomerate, whose businesses range from infrastructure to property, retail, cement, beer, power and semiconductors, said the pharmaceutical operation was set to become the group's earnings driver in the future.

The group planned to invest more than HK$10 billion to restructure and expand its pharmaceutical business and aimed to float shares of China Resources Medications Group in Hong Kong in the next three to five years, Mr Chen said.

He said both Worldbest and Sanjiu, or 999 Group, major players in the mainland pharmaceutical industry, had negative assets of about five billion yuan (HK$5.48 billion) each when China Resources bought them.