Tongjitang Chin Medi Co Ads (NYSE:TCM)

SHENZHEN, China, April 15, 2011 /PRNewswire-Asia-FirstCall/ -- Tongjitang Chinese Medicines Company ("Tongjitang" or the "Company"; NYSE: TCM), announced today the completion of its acquisition by Hanmax Investment Limited, a British Virgin Islands business company ("Hanmax"), and Fosun Industrial Co., Limited, a company incorporated in Hong Kong ("Fosun"). As a result of the acquisition, the Company became a wholly owned subsidiary of Hanmax and Fosun. Hanmax is an affiliate of Mr. Xiaochun Wang, chairman of the board of directors and chief executive officer of the Company.

Under the terms of the agreement and plan of merger, which was adopted by the Company's shareholders at a special meeting held on March 31, 2011, each outstanding ordinary share of the Company (other than shares held by Hanmax or Fosun or any of their respective subsidiaries or shares as to which shareholders have validly exercised and have not effectively withdrawn or lost their appraisal rights under Section 238 of the Cayman Companies Law) was automatically converted into the right to receive $1.125 in cash, without interest and less any applicable taxes, and each American Depositary Share, or ADS (each of which represents four ordinary shares) (other than ADSs held by Hanmax or Fosun or any of their respective subsidiaries), was automatically converted into the right to receive $4.50 in cash per ADS without interest and less any applicable taxes.

Shareholders and holders of ADSs of record will receive a letter of transmittal and instructions on how to surrender their ordinary shares or ADSs in exchange for the merger consideration. Shareholders and holders of ADSs should wait to receive the letter of transmittal before surrendering their shares or ADSs.

The Company also announced today that it requested that trading of its ADSs on the NYSE be suspended. The Company requested an application on Form 25 be filed with the SEC to remove the Company's ADSs from listing on the NYSE and from registration under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company intends to terminate its reporting obligations under the Exchange Act by promptly filing a Form 15 with the SEC to terminate its reporting obligations with respect to the ADSs under the Exchange Act. The Company's obligations to file with the SEC certain reports and forms, including Form 20-F and Form 6-K, will be suspended immediately as of the filing date of the Form 15 and will cease as of the effective date of the Form 15.

SHENZHEN, China, March 31, 2011 /PRNewswire-Asia-FirstCall/ -- Tongjitang Chinese Medicines Company announced today that, at an extraordinary general meeting held today, the Company's shareholders voted in favor of the proposal to adopt the previously disclosed Agreement and Plan of Merger, dated as ofOctober 29, 2010, as amended on February 21, 2011 (the "Merger Agreement"), among Tongjitang, Hanmax Investment Limited ("Hanmax"), Fosun Industrial Co., Limited ("Fosun"), and Tonsun International Company Limited ("Merger Sub"), a company owned by Hanmax and Fosun, pursuant to which Merger Sub will be merged with and into Tongjitang with Tongjitang being the surviving corporation. Of the ordinary shares voted at the extraordinary general meeting, approximately 99.68% were voted in favor of the proposal to adopt the Merger Agreement.

If the merger is completed as the parties expect, Tongjitang will continue its operations as a privately-held company owned solely by Hanmax and Fosun. The parties currently expect the merger to close in April 2011.

Fourth Quarter Results:

• Net revenue from continuing operations(i) increased 33.6% to RMB 188.8 million ($28.6 million)(ii), from RMB 141.3 million in the prior year period.
• Operating income from continuing operations rose to RMB 18.7 million ($2.8 million) from RMB 2.7 million in the prior year period.
• Net income from continuing operations was RMB 11.4 million ($1.7 million), which yielded earnings from continuing operations per share(iii) of RMB 0.11 ($0.02).
• Total net income attributable to the Company was RMB 13.0 million ($2.0 million), which yielded earnings per ADS of RMB 0.50 ($0.08) and earnings per share of RMB 0.13 ($0.02).
• Non-GAAP adjusted EBITDA per share was RMB 0.25 ($0.04), compared to RMB 0.14 in the fourth quarter of 2009.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, "Our strong revenue performance in the fourth quarter reflects notable and increasing contributions from our major drugs, Xianling Gubao and Jingshu Granules, which were included in the National Essential Drug List ("EDL"), as well as for Moisturizing and Anti-Itching Capsules.  This revenue improvement shows the long-anticipated benefits of the healthcare reform and reflects gradual implementation of the EDL by local governments.  We have started to realize gains from the industry reform and are confident that further implementation will continue to contribute to our long-term success."

Financial Results for the Quarter Ended September 30, 2010

• Net revenue from continuing operations increased 35.2% to RMB129.2 million ($19.3 million)(1), from RMB95.6 million in the prior year period.

• Operating loss from continuing operations was RMB3.1 million ($0.5 million), compared to RMB15.3 million in the prior year period.

• Net loss from continuing operations was RMB3.4 million ($0.5 million), which yielded net loss from continuing operations per share(2) of RMB0.03 ($0.00).

• Total net loss attributable to the Company was RMB6.2 million ($0.9 million), which yielded net loss per ADS of RMB0.24 ($0.04) and net loss per share of RMB0.06 ($0.01).

• Non-GAAP adjusted EBITDA per share was RMB0.03 ($0.00), compared to negative EBITDA per share of RMB0.06 in the third quarter of 2009.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, "Our strong revenue performance in the third quarter reflects notable and increasing contributions from our two major drugs, Xianling Gubao and Jingshu Granules, due to their inclusion in the National Essential Drug List ("EDL").  This revenue improvement shows the long-anticipated benefits of the healthcare reform and reflects gradual implementation of the EDL by local governments.  We have started to realize gains from the industry reform and are confident that further implementation will continue to contribute to our long-term success."