Firms announce Laobaixing pharmacy purchase

Private equity firm FountainVest Partners announced it will cooperate with Primavera Capital Group to purchase 25 percent of Laobaixing Pharmacy, a leading Chinese pharmacy chain operator.

With this move, Laobaixing will leverage the abundant global resources of two investment firms for more innovation and growth, according to chairman Xie Zilong.

Laobaixing, founded in 2001, is one of the earliest pharmaceutical retail firms in China to start a chain trial. It now boasts one of the widest distribution networks in the nation.

"China's retail pharmacy industry is embracing huge and sustainable opportunities, which is in line with the country's medical system reform and efficiency improvements. This is also why we look highly on China's core healthcare industry strategy," said Frank Tang, chairman and CEO of FountainVest.

Fred Hu, founder and chairman of Primavera Capital Group, noted Laobaixing will play a more important role, with the sector accelerated to be more standardized and professional.