First China Pharma (OTC:FCPG) yesterday signed a letter of intent to acquire a Chinese company De Xin Pharmacy, located in Yunnan Province, China. The stock price added over 12% on the buying pressure which followed.
The company stated they have been in talks with De Xin for 5 months before any official intentions were expressed. The letter of intent, however, is not a binding agreement and does not guarantee the acquisition will certainly take place.
The acquisition would be the first step to fulfilling FCPG’s strategic plans of expansion. De Xin is attractively positioned in one of the Kunming City’s shopping malls with significant consumer traffic.[BANNER]
FCPG’s traders remain exited since the company secured distribution agreements with three hospitals in Yunnan Province in October, 2010 and consequently was able to acquire new product lines and expand their operations.
FCPG shell was recently acquired by Kun Ming Xin Yuan Tang Pharmacies Co. Ltd. on September 15, 2010. According to the preliminary fillings, the company had nearly $14 million in sales over the first half of 2010 as well as $20 million in assets with no long term debt. First China currently is the only American company to have Government approval to fill pharmaceutical orders over the Internet.
