Global Cord Blood Corporation (NYSE:CO)

WEB NEWS

Wednesday, November 20, 2019

Comments & Business Outlook

HONG KONG, Nov. 20, 2019 /PRNewswire/ -- Global Cord Blood Corporation (CO) (the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today commented on a new regulation related to companies in possession of human DNA information relating to the PRC. The Company is still in the process of evaluating the implications of the new regulation on the cord blood banking industry and its business.

The Regulation of the People's Republic of China on the Administration of Human Genetic Resources (the "Regulation") has come into effect and the Company recently received an inquiry concerning its impact on the Company. The Regulation specifies that "the collection, preservation, utilization and external provision of China's human genetic resources shall comply with this regulation." The Regulation also states that foreign organizations and domestic institutions founded or controlled by foreign entities will have to work with Chinese partners if they need human genetic resources in China for scientific research. According to the Regulation, human genetic resources refer to substances containing human genes, such as organs and cells, as well as information about human genes.

The Regulation itself and its preliminary explanations do not specify whether the services that the Company provides fall into its targeted regulation category. In light of the Regulation's ambiguity, the Company will further evaluate the potential effects of the Regulation on the Company and the cord blood banking industry in China.

The Company cautions its shareholders and others considering trading its ordinary shares that further interpretation of the Regulation has not yet been obtained and that the application of the Regulation on the Company and the cord blood banking industry in China is not yet conclusive. The Company will issue further announcements to keep the market informed in case of any new material developments.


Wednesday, October 16, 2019

Comments & Business Outlook

NEW YORK, Oct. 16, 2019 /PRNewswire/ -- The Committee for China Cord Fairness (the "Committee") today announced that both leading proxy advisory firms, Institutional Shareholder Services Inc. ("ISS") and Glass, Lewis & Co. ("Glass Lewis"), have supported the Committee's proposal to ensure adequate protection of the minority shareholders of Global Cord Blood Corporation (CO) ("Global Cord" or the "Company") in any business combination or major corporate transaction.

The Committee is extremely gratified that the two leading independent proxy advisory firms have each supported its proposal requiring a vote of the unaffiliated minority shareholders for any business transaction that Global Cord may seek to complete. Glass Lewis noted that conditioning transactions on a majority vote of minority shareholders can help provide minority shareholders the necessary protection for their interests and is in line with best practices of corporate governance. ISS also supported two additional key governance proposals, namely (i) the Committee's proposal to require Global Cord's Board of Directors (the "Board") to align management incentives with shareholder value enhancement through the inclusion of performance metrics in its incentive plans and (ii) the Committee's proposal to demand that the Board take all necessary steps in its power to require henceforth that the Chair of the Board be an independent member of the Board.

Glass Lewis noted:

"With respect to the Dissident's advisory proposals, as in any transaction involving insiders or major shareholders, we would support the inclusion of a 'majority of the minority' shareholder voting condition in any transaction agreement requiring shareholder approval. Thus, we see no reason not to support the Dissident's proposals asking the board to take steps within its power to condition any eventual transaction with Cordlife (Proposal 1), or another transaction involving a material acquisition by Global Cord (Proposal 3), on a majority vote of unaffiliated minority shareholders of the Company. In our view, these proposals are consistent with best practices of corporate governance and we believe it is reasonable for minority shareholders to seek such a provision in this case."

ISS noted:

"[C]oncern remains with the discretionary nature of the short-term incentive program. Shareholders typically expect incentive programs that are based on objective performance goals and, in this case, the pay program lacks elements that incorporate any specific pre-set performance metrics."

"A number of governance shortcomings have been identified, which suggest that shareholders would benefit from stronger independent board leadership in the form of an independent chair. The board is not majority independent and a key committee is chaired by the CEO/chair. Further, the company does not have an independent presiding director to serve as an effective counterbalance to the CEO/chair. Although the company's governance guidelines provide a framework to appoint a presiding director, none appears to have been appointed since the company's IPO."

The two leading independent proxy advisory firms agree that minority shareholder protections are warranted at Global Cord!


Wednesday, August 28, 2019

Comments & Business Outlook

First Quarter 2020 Financial Results

  • Revenues increased by 16.9% year-over-year ("YoY") to RMB273.4 million ($39.8 million).
  • EARNINGS PER SHARE. Basic and diluted earnings per ordinary share for the first quarter fiscal 2020 was RMB0.89 ($0.13).

"During the first quarter of fiscal 2020, even though macro-economic uncertainty continued to pressure consumer spending on preventive healthcare services, we managed to record 20,815 new subscribers, in line with our expectations," said Ms. Ting Zheng, Chairperson and Chief Executive Officer of GCBC. "As we step into a more economically volatile fiscal year, we will remain alert to the market changes as well as any potential developments in the regulatory regime governing the cord blood banking industry in China. We will strive to expand service offerings and may mitigate business concentration risk through acquisitions in addition to increasing our penetration and business expansion."


Wednesday, June 19, 2019

Comments & Business Outlook

Fourth Quarter of Fiscal 2019 Financial Results

  • Fourth quarter revenues increased by 8.0% year over year ("YoY") to RMB251.7 million ($37.5 million).
  • EARNINGS PER SHARE. Basic and diluted earnings per ordinary share for the fourth quarter of fiscal 2019 improved to RMB0.74 ($0.11).

"During fiscal 2019, the total newborn number in China and in the markets we operate decreased. Despite the market condition, we managed to recruit over 89,000 new subscribers, hitting the upper bound of our fiscal 2019 target. The management team is glad with our achievements," said Ms. Ting Zheng, Chairperson and Chief Executive Officer of GCBC.

"We expect volume contributions from our three markets to remain in their respective trends, and we maintain caution regarding near-term volumes. We believe that our new pricing will absorb some rising cost pressures and bridge the revenue gap while better reflecting the Company's market position. As we continue to re-examine our capital on hand, business position, core competencies, and strategy, we also remain alert to the possible changes ahead together with available opportunities. With the solid foundation set forth by our PRC cord blood banking business, we continue our commitment towards enhancing service quality, customer experience, and taking a pro-active approach to expand our business scope and service offerings in order to take the Company to the next phase," Ms. Zheng concluded.




Tuesday, June 4, 2019

Going Private News

HONG KONG, June 4, 2019 /PRNewswire/ -- Global Cord Blood Corporation (NYSE: CO) (the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that its board of directors has received a non-binding proposal letter from Cordlife Group Limited ("Cordlife"), a company listed on the Mainboard of the Singapore Exchange Securities Trading Limited ("SGX"), pursuant to which Cordlife proposes to combine the businesses of Cordlife and the Company, by way of a statutory merger. Cordlife will issue its ordinary shares at an issue price of SGD0.5 per ordinary share in exchange for all of the outstanding ordinary shares of the Company at US$7.50 per ordinary share. 

According to the proposal letter, which is dated June 4, 2019, Cordlife would issue approximately 2,497.9 million ordinary shares in exchange for all of the outstanding shares of the Company. Upon completion of the proposed transaction, the Company's ordinary shares will be delisted from the New York Stock Exchange and the Cordlife ordinary shares will continue to trade on SGX. Completion of the proposed transaction is subject to various conditions, including but not limited to, satisfactory completion of due diligence, approval by the board of directors and shareholders of Cordlife and the Company, applicable regulatory approvals and other customary conditions.

The Company expects that its board of directors will form a special committee of independent directors (the "Special Committee") to consider the proposed transaction. The Company also expects that the Special Committee will retain advisors, including an independent financial advisor and legal counsel, to assist it in its work.

The Company cautions its shareholders and others considering trading its ordinary shares that no decisions have been made with respect to the Company's response to the proposed transaction. The proposed transaction is still subject to various conditions, including but not limited to, completion of due diligence, parties entering into definitive agreement, and/or each of Cordlife and the Company obtaining its relevant regulatory and shareholders approval. There can be no assurance that any definitive offer will be made, that any agreement will be executed or that this or any other transaction will be approved or consummated.


Thursday, April 4, 2019

Comments & Business Outlook

HONG KONG, April 1, 2019 /PRNewswire/ -- Global Cord Blood Corporation (CO) ("GCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, today announced that the Company is increasing its processing fee by RMB3,000 to RMB9,800, effective on April 1, 2019. The Company's annual storage fee is unaffected by this increase.

The Company is committed to delivering high quality and top of the line services to all clients, and this is evidenced by the Company's continuous investment in cord blood banking hardware as well as software. The Company's skillful and experienced workforce have also contributed remarkably towards the Company's ability to maintain its technological leadership in China's cord blood banking industry. The Company strongly believes that the new pricing will not only absorb some of the rising costs associated with the Company's technological and service advancements, but also properly position the Company's services among its peers in China.

"We expect to constantly review our subscription fee in light of changes in market conditions, the Company's strategy, and costs related to continual improvement of technologies and services, and we will revise them when appropriate," said Ms. Ting Zheng, Chairperson and Chief Executive Officer of GCBC. "The fee adjustment follows our strategic focus on the mid-to-high end market. It is intended to empower us to further enhance the customer experience and improve referral generation."


Monday, April 1, 2019

Comments & Business Outlook

HONG KONG, April 1, 2019 /PRNewswire/ -- Global Cord Blood Corporation (CO) ("GCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, today announced that the Company is increasing its processing fee by RMB3,000 to RMB9,800, effective on April 1, 2019. The Company's annual storage fee is unaffected by this increase.


Tuesday, February 26, 2019

Comments & Business Outlook

Third Quarter 2019 Financial Results

  • Revenues increased by 3.7% year over year ("YoY") to RMB254.2 million ($37.0 million).
  • EARNINGS PER SHARE[5]. Basic and diluted earnings per ordinary share for the third quarter of fiscal 2019 were RMB0.51 ($0.07) compared to RMB0.61 in the prior year period. The difference was largely a result of a greater number of shares outstanding compared to the prior year.

"During the third quarter, we augmented our sales and marketing efforts as market conditions have shifted to a more cautious consumer spending environment. Consequently, our new subscribers increased by 3.3% from the previous quarter and were in line with our expectations." said Ms. Ting Zheng, Chairperson and Chief Executive Officer of GCBC. "Although economic and industry uncertainties remain, we are committed to achieving our annual subscriber target for fiscal 2019. To expand revenue sources and enhance our leading position, we will remain flexible and adjust to market conditions as necessary to maximize our financial performance and explore potential development opportunities."


Wednesday, November 28, 2018

Comments & Business Outlook

Second Quarter 2019 Financial Results

  • Revenues increased by 5.3% year over year ("YoY") to RMB247.1 million ($36.0 million).
  • EARNINGS PER SHARE[5]. Basic and diluted earnings per ordinary share for the second quarter of fiscal 2019 were RMB0.54 ($0.08) and RMB0.53 ($0.08) compared to RMB0.60 in the prior year period.

"We are glad to see the new subscriber number increase by 11.2% in the second quarter from the previous quarter, which demonstrates the success of the measures we took under current market conditions. As we continue to execute on our strategies, we remain cautiously optimistic about our growth prospects in the second half of the year, which are supported by the Chinese government announcing business-friendly policies amid escalating trade tensions between the U.S. and China." said Ms. Ting Zheng, Chairperson and Chief Executive Officer of GCBC. "While keeping our focus on nurturing and penetrating existing domestic markets, we will continue to explore potential development opportunities to expand revenue sources or save costs in order to consolidate our position as the industry leader."


Friday, August 24, 2018

Comments & Business Outlook

First Quarter 2019 Financial Results

  • Revenues increased to RMB233.8 million ($35.3 million) from RMB224.2 million in the prior year period.
  • EARNINGS PER SHARE. Basic and diluted earnings per ordinary share for the first quarter fiscal 2019 was RMB0.61 ($0.09).

"In the first quarter of fiscal 2019, we recorded 20,601 new subscribers, in line with our quarterly target. Despite the difficulty in client conversion as consumer spending became more conservative in the face of macroeconomic uncertainty, we are delighted to see new subscriber numbers stabilizing at current levels." said Ms. Ting Zheng, Chairperson and Chief Executive Officer of GCBC. "As we sail through the storm, we will remain focused on penetrating our existing markets as well as searching for business development opportunities in the hematopoietic cord blood industry value chain domestically and abroad, aiming to provide additional cord blood related healthcare and treatment services to our clients."


Monday, August 20, 2018

Special Dividend

HONG KONG, Aug. 17, 2018 /PRNewswire/ -- Global Cord Blood Corporation (CO) ("GCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, today announced the results of the scrip dividend elections. The election period during which the Company provided to all of its shareholders the option to elect to receive, in cash or ordinary shares of the Company, a dividend payment of US$0.08 per share ended at Noon Eastern Daylight Time on August 16, 2018. During the election period, of the 120,824,742 ordinary shares of the Company outstanding as of July 30, 2018, the record date, holders of 87,523,354 ordinary shares notified the Company of their election to receive the dividend in the form of ordinary shares of the Company.

As a result of these elections, the Company will issue a total of 726,333 ordinary shares and consequently the Company's outstanding ordinary shares will consist of a total of 121,551,075 ordinary shares. The delivery of the newly issued ordinary shares as well as the payment of the cash distribution is expected to occur on August 20, 2018.


Thursday, February 8, 2018

Comments & Business Outlook
HONG KONG, Feb. 7, 2018 /PRNewswire/ -- China Cord Blood Corporation (CO) ("CCBC" or the "Company"), leading cord blood banking operator in China, today announced that the Board of Directors of the Company (the "Board") has approved seeking shareholder approval regarding the change of the Company's name from "China Cord Blood Corporation" to "Global Cord Blood Corporation" ("Change of Name"). The Board believes that the Change of Name better reflects the future development direction and business strategy of the Company. The Company plans to hold an extraordinary general meeting ("EGM") for shareholders to approve the Change of Name at its Hong Kong office at 48/F, Bank of China Tower, 1 Garden Road, Central, Hong Kong, at 8:00 p.m. Hong Kong Time on March 16, 2018 (8:00 a.m. U.S. Eastern Daylight Time on March 16, 2018).

Wednesday, January 31, 2018

Joint Venture

HONG KONG, Jan. 31, 2018 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"),  a leading cord blood bank operator in China, today announced that Nanjing Ying Peng Hui Kang Medical Industry Investment Partnership (limited partnership) ("Nanjing Ying Peng"), via its subsidiary, has become a major shareholder of the Company.

Following the entry of Nanjing Ying Peng, Mr. Ping Xu was appointed as a director of the Board of Directors of the Company (the "Board"). Mr. Xu is a senior vice president of Sanpower Group Co., Ltd and the authorized representative of the executive partner of Nanjing Ying Peng. Mr. Xu possesses extensive knowledge and experience in cross-border M&A and project financing. Mr. Xu also spearheaded multiple merger and acquisition initiatives both inside and outside of the People's Republic of China.

Simultaneously, the Company announced that Mr. Yuen Kam has resigned from his positions as Chairman and director of the Board and as Chairman and member of the Nominating and Corporate Governance Committee (the "Nominating Committee") of the Company. His resignation was accepted by the Board and is effective as of January 31, 2018.

Following Mr. Kam's resignation, Ms. Ting Zheng, Chief Executive Officer of the Company, was appointed as the Chairperson of the Board and the Chairperson of the Nominating Committee. Mr. Mark Chen, one of the Company's existing independent non-executive directors also joined as a new member to the Nominating Committee.

"We would like to express our most sincere gratitude to Mr. Kam for his years of excellent leadership and incalculable contributions. At the same time, we welcome Mr. Xu to the team. We believe Mr. Xu will be an invaluable addition to our Board leadership and his extensive experience will provide further insight towards the Company's future developments." said Ms. Ting Zheng, "We are excited and look forward to working together with Nanjing Ying Peng to continue to expand our cord blood banking initiatives."

Nanjing Ying Peng is a limited partnership incorporated in China and governed by the laws of China. Nanjing Ying Peng, which owns 65.4% of the total issued share capital of the Company, will continue to observe and comply with all relevant reporting and filing requirements.


Monday, August 28, 2017

Notable Share Transactions

HONG KONG, Aug. 28, 2017 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) (the "Company") today announced that Magnum Opus Second (PTC) Limited, an entity holding ordinary shares on behalf of certain directors and members of senior management, has adopted a 10b5-1 sales plan to sell up to 2,275,700 ordinary shares from time to time in ordinary brokerage transactions, primarily to meet the individuals' personal needs.

Under the Company's corporate trading policies, a 10b5-1 sales plan is recommended for directors and members of senior management in order to comply with insider trading principles and reduce the possibility of opportunistic selling by management. In accordance with such sales plan, the trustee intends to sell up to an aggregate of 2,275,700 ordinary shares over time, representing approximately 1.9% of the Company's total outstanding shares as of August 2017.

Rule 10b5-1 allows corporate insiders to establish prearranged written plans to buy or sell a specified number of shares of company stock over a predetermined period of time. Insiders may adopt such plans when they are not in possession of material inside information in order to gradually change their investment portfolio to minimize the market effects of significant stock sales or purchases by spreading them out over an extended period of time and to avoid concerns about initiating stock transactions while in possession of material nonpublic information.

Any sales by the Company's insiders may also be made in privately negotiated transactions, in block trades or other legally permissible ways from time to time depending on market conditions and in accordance with applicable rules and regulations.


Thursday, August 24, 2017

Comments & Business Outlook

First Quarter 2018 Financial Results

  • Revenues for the first quarter of fiscal 2018 increased by 29.6% to RMB224.2 million ($33.1 million) from RMB173.0 million in the prior year period.
  • EARNINGS PER SHARE. Basic and diluted earnings per ordinary share for the first quarter of fiscal 2018 increased to RMB0.62 ($0.09)5 from RMB0.22 in the prior year period.

"In the first quarter of fiscal 2018, we recorded 22,523 new subscribers, representing a year-over-year growth of 35.4%. The strong growth was mainly due to our ongoing efforts to enhance our sales team and the more effective and precise sales and marketing strategy. During this quarter, the majority of our new subscribers still came from the Guangdong market and the Beijing market performed steadily as expected." said Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation. 

"In the reporting period, the National Health and Family Planning Commission and five other ministries in China collectively issued the "13th Five-Year Plan - A Specific Program for Health and Health Science and Technology Innovation"3, which signals their full support to the stem cell and regenerative medicine industry and provided clarity on regulations for the clinical applications of biotherapies.  At the same time, the China Maternal and Child Health Association formed its Umbilical Cord Blood Application Committee in Beijing. We believe such developments will be beneficial to the long-term development of the PRC cord blood banking industry.  In the near term, we will continue to explore various sales and marketing tactics to improve demand and expand revenue sources to offset the negative impact of low consumer sentiment and few newborns in certain regions of the PRC."


Thursday, April 13, 2017

Going Private News
HONG KONG, April 13, 2017 /PRNewswire/ -- China Cord Blood Corporation (CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that in response to the non-binding proposal letter dated April 27, 2015 received by the Company's Board of Directors (the "Board") from Golden Meditech Holdings Limited ("Golden Meditech"), relating to the acquisition of all of the outstanding ordinary shares of the Company not already owned by Golden Meditech in a "going private" transaction, the Board has adopted the recommendation of the special committee of independent directors formed to evaluate such proposal to terminate any further evaluation and negotiation regarding such proposal. In making its recommendation, the special committee had taken into account various factors including but not limited to the pending transaction (the "Acquisition") between Golden Meditech and Nanjing Ying Peng Hui Kang Medical Industry Investment Partnership (limited partnership) (the "Purchaser"), the Purchaser's future plans regarding CCBC after the Acquisition is completed and the overall viability of the proposal. The special committee's recommendation was unanimous and the adoption of its recommendation by the full Board of the Company was unanimous, with Chairman Kam Yuen abstaining.

Thursday, April 6, 2017

Deal Flow

HONG KONG, April 6, 2017 /PRNewswire/ -- China Cord Blood Corporation (CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that the Company received notification of exercise of all 7% senior convertible notes ("Notes") held by Golden Meditech Stem Cells (BVI) Company Limited ("GMSC", the "Holder"), a subsidiary of Golden Meditech Holdings Limited beneficially owning 65.4% of the Company on a fully diluted basis.

The aggregate principal amount of the Notes held by GMSC amounts to US$115 million. The conversion price is $2.838 per share. Upon conversion, the Company's total number of ordinary shares outstanding will be increased by approximately 40.5 million to 120.6 million (excluding treasury shares).

Subsequent to such conversion, the Company will have no outstanding convertible notes.


Monday, February 27, 2017

Comments & Business Outlook

Third Quarter 2017 Financial Results

  • Revenues for the third quarter of fiscal 2017 increased by 18.6% to RMB200.9 million ($28.9 million).
  • EARNINGS PER SHARE. Basic and diluted earnings per ordinary share for the third quarter of fiscal 2017 increased by 11.1% to RMB0.70 ($0.10)5 from RMB0.63 in the prior year period.

"Even though economic uncertainties in China during the reporting quarter still put pressures on demand of precautionary healthcare services such as ours, we managed to keep a satisfying new subscriber growth through channels improvement, sales expansion, as well as public education enhancement. During the quarter, as part of our effort to further capitalize our resources on hand and industrial know-how, we entered into collaboration with Golden Meditech Holdings Limited ("Golden Meditech"), by rendering consultation services and granting Golden Meditech exclusive access to certain data derived from a small portion of our donated cord blood samples. This collaboration demonstrated our ability to continue monetizing our existing resources to further enhance our profitability," said Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation.

"Looking into the future, despite the challenges ahead, we will strive to achieve our fiscal 2017 subscription target. I will also like to draw your attention to the proposed transaction between Golden Meditech and Nanjing Ying Peng Hui Kang Medical Industry Investment Partnership (limited partnership) ("NJYP"). We will like to caution shareholders and potential investors that the transaction is yet to complete and we will continue to update the market when new development unfold."


Thursday, January 5, 2017

Comments & Business Outlook

HONG KONG, Jan. 4, 2017 /PRNewswire/ -- China Cord Blood Corporation (CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, today announced the Company has been informed that Golden Meditech Holdings Limited, a Hong Kong listed company and a substantial shareholder of the Company ("Golden Meditech"), Golden Meditech Stem Cells (BVI) Company Limited, a wholly-owned subsidiary of Golden Meditech ("GM Stem Cells") and Nanjing Ying Peng Hui Kang Medical Industry Investment Partnership (limited partnership) ("Nanjing Ying Peng") entered into a conditional share purchase agreement on December 30, 2016 (the "Share Purchase Agreement"), pursuant to which GM Stem Cells has agreed to sell to Nanjing Ying Peng approximately 65.4% of the Company's issued share capital on a fully diluted basis (the "GM Shares") for RMB5,764 million in cash.

According to publicly available information, the effectiveness of the Share Purchase Agreement is subject to, among certain other conditions, Golden Meditech having obtained the approval of its shareholders to proceed with the sale and purchase of the GM Shares and the approvals of the Hong Kong Stock Exchange and other relevant regulatory authorities and all requisite consents from third parties to proceed with the sale and purchase of the GM Shares. The completion of the sale and purchase of the GM Shares is conditional upon, among certain other conditions, Nanjing Ying Peng having obtained the approvals as required by its partnership agreement to proceed with the sale and purchase of the GM Shares. Nanjing Ying Peng's obligations under the Share Purchase Agreement have been guaranteed by Sanpower Group Co., Ltd. ("Sanpower") and its founder and chairman Mr. Yafei Yuan, the purchase price will be held in an escrow account pending closing or upon the occurrence of certain release events and the parties have agreed to grant each other reciprocal share charges to secure their respective obligations in accordance with the transaction documents.

In connection with the Share Purchase Agreement, other pending share sale arrangements entered into by Golden Meditech and Nanjing Xinjiekou Department Store Co., Ltd. (another affiliate of Sanpower) earlier in 2016 will be terminated subject to, among certain other conditions, Golden Meditech obtaining its shareholders approval to do so.

The Company cautions its shareholders and others considering trading in its securities that there can be no assurance that the transaction pursuant to the Share Purchase Agreement or any other transaction will be approved or consummated. The Company does not undertake any obligation to provide any updates with respect to these transactions, except as required under applicable law.


Friday, December 30, 2016

Comments & Business Outlook

HONG KONG, Dec. 30, 2016 /PRNewswire/ -- Golden Meditech Holdings Limited (SEHK stock code: 00801, TWSE stock code: 910801) ("Golden Meditech" or the "Company", together with its subsidiaries, the "Group"), a leading integrated healthcare enterprise in China, announces that it entered into a sale and purchase agreement with Nanjing Yingpeng Huikang Medical Industry Investment Partnership (Limited Partnership) 1 ("Yingpeng Huikang Fund" or the "Purchaser") on 30 December 2016 regarding the disposal of the Company's entire equity stake in China Cord Blood Corporation ("CCBC") which represents 65.4% equity interest in CCBC on a fully diluted basis, for total cash consideration of RMB5.764 billion. The Company will host an extraordinary general meeting for shareholders to approve the transaction. 

As part of the transaction, Golden Meditech agrees to give three years' performance guarantee of CCBC in favour of the Purchaser. In case of earnings shortfall, Golden Meditech will compensate the Purchaser by cash in an amount to be calculated in accordance with the formula set forth in the profit compensation agreement.

Upon completion, this transaction will result in significant return to both the Group and its shareholders. The Group will utilise the capital derives from this transaction to consolidate its healthcare services platform, further expand its medical and healthcare businesses and engage in strategic diversification. The board of directors of the Company will also consider a possible dividend payment as a mean to reward its shareholders.

The completion of the transaction is conditional upon the satisfaction of effectiveness conditions and the satisfaction (or waiving, if applicable) of all the condition precedents as set out in the sale and purchase agreement, including but not limited to obtaining all relevant regulatory approvals and shareholders' approvals.


Friday, November 18, 2016

Comments & Business Outlook

Second Quarter 2017 Financial Results

  • Revenues for the second quarter of fiscal 2017 increased by 7.4% to RMB184.1 million ($27.6 million) from RMB171.5 million in the prior year period.
  • Basic and diluted earnings per ordinary share for the second quarter of fiscal 2017 were RMB0.22 ($0.03) vs last years .

"During the second quarter, new subscriber numbers increased by 7.7% year-over-year to 18,037 as a result of the solid performance in our Guangdong market, the steady growth in our Beijing market and the Zhejiang market due to our strong hospital channels and tailored marketing initiatives," said Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation. "While the macroeconomic environment was slower and regulations on clinical applications of stem cells remains uncertain in the reporting quarter, we managed to continue our growth by focusing on new subscriber recruitment. We are confident that we will achieve our full year subscription target goal through organic growth in our core business. We will also explore potential new business opportunities as well as optimize existing resources to further expand revenue and profit growth."


Tuesday, August 23, 2016

Comments & Business Outlook

First Quarter 2017 Financial Results

  • Revenues for the first quarter of fiscal 2017 increased by 4.6% to RMB173.0 million ($26.0 million) from RMB165.4 million in the prior year period.
  • EARNINGS PER SHARE. Basic and diluted earnings per ordinary share for the first quarter of fiscal 2017 were RMB0.22 ($0.03).5

"Demand for our cord blood banking services showed healthy improvement as the number of newborns in China grew in the first quarter of fiscal 2017. We continued to optimize our marketing efforts and enhance our sales force, resulting in over sixteen thousand new subscribers during the reporting period, a reasonable increase over the prior year. Our accumulated subscriber base rose 13.9% to over 520,000 as of the end of June 2016, compared with that as of the end of June 2015," said Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation. "As we look at our opportunity in the near-term, we maintain a prudent outlook as China's overall economy continues to slow, which could impact consumer spending levels. Additionally, the National Health and Family Planning Commission recently rolled out a detailed policy to further regulate the clinical applications of various stem cells. These events may result in some near-term slowing of new client subscriptions, however we believe such regulation will benefit CCBC and the broader cord blood banking industry over the longer term. Looking ahead to the second quarter, we are committed to meeting such challenges by raising awareness and emphasizing the clinical benefits of our services. We will strive to achieve our full year subscription target goal through careful planning and prudent execution."


Wednesday, June 15, 2016

Comments & Business Outlook

Fourth Quarter 2016 Financial Results

  • Revenues for the fourth quarter of fiscal 2016 amounted to RMB156.8 million ($24.3 million) compared to RMB163.0 million in the prior year period.
  • Basic and diluted earnings per ordinary share for the fourth quarter of fiscal 2016 were RMB0.18 ($0.03).6

Ms. Ting Zheng, Chief Executive Officer of CCBC commented, "Despite the challenges we faced in the reporting period, we recruited 14,472 new subscribers, representing a decrease of 9.4% year-on-year and a decrease of 7.2% quarter-on-quarter. Revenue mix in terms of regional contribution remained stable compared to the last few quarters and our client payment mix was similar to prior quarters. We are pleased that the Group accumulated subscriber base has surpassed the half a million mark for the first time and reached 504,268 subscribers as of March 31, 2016."

"Looking ahead, the management expects the number of newborns to rebound from the low level during the Year of the Sheep. However, we also expect a slowing economy could dampen demand for high-end medical services, including the services we provide. Additionally, we believe the end of the 'one-child policy' is a positive development for the Chinese economy and for our industry over the long term. However, it will take time to attain meaningful traction due to the end of this policy. To overcome these challenges, we plan to continue improving our marketing efforts to increase our penetration and client conversion rates while further tightening our cost structure. Building on our track record of success, established brand and leading market position, we will continue to seek strategic opportunities to further expand our dominant presence in the industry."


Wednesday, April 6, 2016

Shareholder Letters

NEW YORK, April 5, 2016 /PRNewswire/ -- The following is an open letter sent April 5, 2016 to the Board of Directors of China Cord Blood Corp (CO) from Jayhawk Capital.

It is clear that the Board should accept a privatization offer only if ALL shareholders will receive the same $15+ per share ($6.40 in cash and $8.68 in Nanjiang Xinjiekou Department Store Co., Ltd. ("NXD") shares) at which Golden Meditech Holdings Co Ltd ("Golden Med") has agreed to sell its stake. China Cord Blood Corp ("China Cord" or the "Company") should be negotiating directly with NXD and no longer allow Golden Med to be the go-between whose sole intent is to take all the profit for itself.

The pattern of taking value away from shareholders of China Cord has become standard practice.  Consider the convertible bonds issued in 2012 to KKR and then to Golden Med at low prices, thus diluting the existing minority shareholders. The proceeds from the bonds were never needed or used, and the bonds ultimately eliminated $525 million of value for China Cord shareholders (based on the value Golden Med is receiving for them from NXD).

Consider too the share-based incentive compensation for management adopted by the Company in December 2014 whereby nearly 10% of the outstanding shares of China Cord are to be awarded for hitting modest growth targets management was already expected to meet. Golden Med has announced plans to vest these shares immediately as part of the NXD transaction, despite only being one year in and despite even those modest incentive goals not being reached. This will cost shareholders over $100 million (7,080,000 shares x ~$15 per share). Self-interested transactions like these must stop immediately. However, the privatization effort by Golden Med is clearly another disaster waiting to happen for China Cord's minority shareholders.

China Cord has been performing strongly and is expected to continue to do so as the effect of the Chinese Government relaxing the one-child policy begins to be felt more dramatically. China Cord is generating cash of approximately $25 million per quarter and has $440 million of cash on the balance sheet. Furthermore, profit guarantees included in the NXD agreement indicate profits of at least $46 million in 2016, $56 million in 2017 and $67 million in 2018. Assuming the convertible bonds are redeemed by using cash on the balance sheet, these profit guarantees would suggest a stock price of $35 per share (40 P/E x $56mm / 73mm outstanding shares, + cash). If China Cord had not issued the convertible bonds or share-based compensation or dilutive secondary transactions and bought back shares using the cash generated during the previous six years as Jayhawk repeatedly suggested privately and publicly, the stock price could be approximately $90 per share (40 P/E x $56mm / 25mm pro-forma outstanding shares).

NXD has purchased 75% of the Shandong cord blood bank for about $1 billion. China Cord owns the other 25% of the Shandong cord blood bank license plus 3 others: Beijing, Zhejiang and Guongdong. These three wholly-owned licenses are fully operational with larger population bases and should theoretically be valued higher. But applying the valuation of the Shandong license to China Cord's licenses would make the stock worth $67 per share, assuming the convertible bonds are redeemed by using cash on the balance sheet. If China Cord had not issued the convertible bonds or share-based compensation or dilutive secondary transactions and bought back shares using the cash generated during the previous six years as Jayhawk repeatedly suggested privately and publicly, the stock price using this metric would be well above $100 per share.

As publicly disclosed by NXD, both the Shanghai Stock Exchange (on January 20, 2016) and China Securities Regulatory Commission ("CSRC") (on March 14, 2016) have made inquiries on a number of topics related to the proposed transactions between NXD and Golden Med, including a request for an explanation of why the shares Golden Med already owns are valued at $15+ per share, while the minority shares are valued at only $6.40. The CSRC also requested an explanation of the share-based compensation and for the large cash balance so it appears they are also aware these are unusual and unnecessary. Also included are several requests related to how fiduciary duties under U.S. and Cayman laws are being met and how they are addressing the risks of minority shareholder lawsuits related to the transactions.

One of the principal fiduciary duties of the Special Committee is to evaluate the Golden Med offer and require that each shareholder of China Cord be treated fairly. Acting in the best interest of China Cord does not mean acting solely in accordance to the wishes and interests of China Cord's majority shareholder. If the Special Committee allows the actions taken by the executive board of China Cord and its majority shareholder, Golden Med, to go unchecked, the members of the Special Committee will effectively be breaching their duties as directors. The Special Committee should also have negotiated with Zhongyuan Union Cell and Gene Engineering Corp, which indicated a willingness to bid for the Company at similar prices to NXD. The interests of all shareholders must be considered. Failure by the Special Committee to negotiate and reach a price reflecting fair value for all shares in China Cord will be challenged in the courts. The Special Committee should investigate the facts outlined above (e.g. the convertible bonds issued in 2012 and the share-based incentive compensation for management) and seek fair value for all shareholders of China Cord. The Cayman Islands Court in the Integra decision has held that fair value is a value that is "just and equitable" and provides adequate compensation consistent with the requirements of justice and equity.

Neither the Cayman Islands Court nor the United States Courts will uphold the actions that have been taken by China Cord and its majority shareholder which effectively perpetrate a systematic fraud on minority shareholders.

NXD has made multiple international acquisitions and has appeared to act in a professional and ethical manner. The Special Committee could and should be negotiating directly with NXD for a sale of 100% of China Cord for the same cash plus stock deal Golden Med is receiving. This would provide the minority shareholders the opportunity to participate in the continued success of China Cord if the stock price of NXD appreciates as expected. As part of discharging its fiduciary duties, the Special Committee should evaluate and pursue competing offers and require equal treatment for all shareholders. For the Special Committee to allow Golden Med to hijack the process to keep all the profits for itself would be an appalling breach of fiduciary duties.

Yours faithfully,

Jayhawk Capital


Tuesday, March 1, 2016

Comments & Business Outlook

Third quarter 2016 financial Results

  • Revenues for the third quarter of fiscal 2016 increased by 1.6% to RMB169.4 million ($26.1 million) from RMB166.7 million in the prior year period.
  • EARNINGS PER SHARE. The terms of the outstanding convertible notes provide each holder with the ability to participate in any Excess Cash Dividend5. Therefore, the calculation of basic and diluted EPS has taken into consideration the effect of such participating rights, which was RMB0.06 ($0.01) per share. Basic and diluted earnings per ordinary share for the third quarter of fiscal 2016 were RMB0.63 ($0.10).

"In the third quarter of fiscal 2016, we continued to face the challenges from the Chinese Lunar "Year of Sheep" and overall weak economic sentiment. Under such conditions, the Group recorded 15,603 new subscribers in the reporting period, representing a year-over-year decrease of 11.5% and a quarter-over-quarter decrease of 6.8%," commented Ms. Ting Zheng, Chief Executive Officer of CCBC, "However, we continued to experience strong momentum in our regional markets. Our Guangdong market reported another quarter of solid results, and our Zhejiang market continued to improve steadily, which helped offset some of the market pressure in the fiscal third quarter. We were further encouraged by the established operation and the accreditation from American Association of Blood Banks. Based on the Group's performance in the first nine months of fiscal 2016 and our market visibility in the coming quarters, the management team remains cautious but we will continue to act proactively and strive to meet our new subscribers target this fiscal year."


Thursday, January 7, 2016

Comments & Business Outlook

HONG KONG, Jan. 7, 2016 /PRNewswire/ -- Golden Meditech Holdings Limited (SEHK stock code: 801, TWSE stock code: 910801) ("Golden Meditech" or the "Company", together with its subsidiaries, the "Group"), a leading integrated healthcare enterprise in China, announces that it entered into a conditional sale and purchase agreement with Nanjing Xinjiekou Department Store Co., Ltd. (SSE stock code: 600682) ("Nanjing Xinjiekou") on 6 January 2016 regarding the disposal of its 65.4% equity interest (fully diluted) in China Cord Blood Corporation (NYSE stock code: CO) ("CCBC") for a total consideration of approximately RMB 5.76 billion.

The total consideration consists of a cash payment of approximately US$504.8 million (approximately RMB3.26 billion) and the issue of RMB2.5 billion new equity by Nanjing Xinjiekou at the initial issue price of RMB18.61 per share (the "NXD New Shares"). In exchange, Golden Meditech undertakes to retain CCBC management team for a minimum of three years, agrees to give three years' performance guarantee and agrees to have the NXD New Shares subject to a three years' lock-up period. As part of the performance guarantee, Golden Meditech can choose to compensate Nanjing Xinjiekou, by cash or the NXD New Shares, in case of earnings shortfall in an amount to be calculated based on the percentage of the shortfall multiplied by the total consideration.

Concurrently, Golden Meditech also entered into another conditional sale and purchase agreement with Nanjing Xinjiekou, pursuant to which Golden Meditech agrees to sell the remaining 34.6% equity interest (fully diluted) of CCBC to be obtained to Nanjing Xinjiekou for a total cash consideration of approximately US$267 million (approximately RMB1.73 billion), if the privatisation of CCBC is completed. 

The completion of both sale and purchase agreements are conditional upon the satisfaction of effectiveness conditions and the satisfaction (or waiving, if applicable) of all the condition precedents of completion, including but not limited to obtaining all relevant regulatory approvals and shareholders' approvals.


Tuesday, November 24, 2015

Comments & Business Outlook

Second quarter 2016 Financial Results

  • Revenues for the second quarter of fiscal 2016 increased by 12.7% to RMB171.5 million ($27.0 million) from RMB152.1 million in the prior year period.
  • Net income per share:Basic and Diluted was RMB 0.25 vs. last years same quarter of RMB 0.35

"During this quarter, despite the challenge we continue to face in the 'year of the sheep' which caused the number of new born within our operational region to contract, the Group managed to recruit 16,744 new subscribers, representing a year-over-year increase of 7.4% and a quarter-over-quarter increase of 4.1%. By end of September 2015, the Group has recruited over 470,000 accumulative subscribers, which further consolidates our client base and market leadership." Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation stated, "In the reporting period, subscribers from Guangdong province make up the majority of the new subscribers. At the same time, our hospital coverage and market presence in Zhejiang market are gradually improving. The management team is cautiously optimistic towards the overall market and the Group's performance in the second half of fiscal 2016. We remain committed toward achieving our annual new subscriber target in this fiscal year."


Wednesday, September 9, 2015

Shareholder Letters

NEW YORK, Sept. 10, 2015 /PRNewswire/ -- The following is an open letter sent September 9, 2015 to the Board of Directors of China Cord Blood Corp (NYSE: CO) from Jayhawk Capital.

We reiterate our conviction that the special committee of the independent directors of China Cord Blood Corp ("China Cord") should REJECT the extremely low privatization offer of $6.40 per share from Golden Meditech Holdings Co Ltd ("Golden Med").  There are rumors in the marketplace that Golden Med will raise their offer to $9 or $10 in response to the significantly higher offers by two outside bidders. We urge you to reject all three offers. We reiterate our recommendation outlined in our letter dated March 19, 2015 that a $125mm special dividend and a $150mm tender offer by the company to repurchase shares, coupled with significant annual dividend payments, would result in a stock price in the $20-$25 range. Moreover, if the company achieves subscriber growth of 10%-15%, as anticipated in your generous employee share grant program, and you increase dividends each year, it is very conceivable that China Cord could achieve a $75-$100 stock price on the New York Stock Exchange in the next 4 or 5 years (much like China Biologic Products Inc. ("CBPO") has done, a company with very similar cash flow characteristics).  Moreover, this plan would BENEFIT and be fair to ALL shareholders: Mr. Kam; Golden Meditech; and the loyal, long-term MINORITY shareholders. 

On June 17, 2015, a dealReporter article referenced an announcement made by Zhongyuan Union Cell and Gene Engineering Corp (600645.SS, "Zhongyuan") that it had hired Citic Securities for a US$1.6 billion acquisition, which would value China Cord at $13 per share.  Zhongyuan received board approval on August 28th to make a foreign acquisition and has also been pushing to have an auction of the China Cord assets in China.  Zhongyuan, a publicly traded stem cell company with a market cap of US$5 billion, understands that an acquisition of China Cord would be incredibly accretive to their business and have great synergies.  On August 6, China Cord received an offer from Nanjiang Xinjiekou Department Store Co., Ltd. (600682.SS, "NXDS"), a subsidiary of Sanpower Group Co., Ltd. ("Sanpower"), a large private conglomerate run by one of China's richest men, YUAN Yafei.  Medical and Health Care companies make up one of Sanpower's five primary investment categories.  Jefferies analyst Brian Tanquilut put out a note that day where he raises his price target to the $11 per share value of NXDS's initial offer.  At a MINIMUM, China Cord's special committee should allow Zhongyuan and NXDS to compete in an auction for China Cord.

As we pointed out in our April 30, 2015 letter, the special committee has a responsibility to act in the best interests of all shareholders. Rejecting higher bids in favor of a lower one proposed by insiders would be in direct conflict with these responsibilities.  Cayman law requires that directors "must apply their minds and exercise independent judgment in the ordinary course of business".  It is the duty of the special committee and the board of directors to not allow Golden Med to privatize the company at below competing offers. Again, any process for selling the company should be open to all interested parties through an auction.

If Golden Med forces through a privatization offer, they must realize that many minority shareholders will exercise their legal rights under Cayman Islands law as a dissenting shareholder and demand fair value.  The Cayman Grand Court has recently, for the first time, set clear guidance on the factors to take into account in assessing fair value. The Cayman Grand Court approved the principle that a shareholder buys into a company as a going concern, not in anticipation of participating in a liquidation, and it follows that, when he elects to dissent from a merger or consolidation brought about at the behest of the majority, he is thereafter deprived of his proportionate share of an active enterprise and is entitled to be compensated for it. Fair value does not include any minority discount. The minority shareholders of China Cord will show very clearly that their shares are worth significantly more than the initial offers from Golden Med, Zhongyuan and Sanpower.  Therefore, Golden Med and Mr. Kam will ultimately be forced to pay a higher price plus interest for the shares of dissenting minority shareholders.

Golden Med struck a favorable deal with KKR, which was then appropriated by Mr. Kam, when the deal was changed to allow him to personally purchase the KKR notes. With his increased ownership of China Cord, hopefully he will do what is right for himself and ALL minority shareholders. Jayhawk Capital again requests that China Cord rejects the offer of $6.40 per share and any other offers from Golden Med or others. Furthermore, rather than negotiating to sell the company at $13-$15 per share, we repeat our requests from our April 30, 2015 and March 19, 2015 letters, to immediately announce and execute a tender offer by the company to repurchase shares and pay a large special dividend to ALL China Cord's shareholders. These two initiatives are for numerous reasons in the best interest of ALL the shareholders and we believe the stock price would quickly climb to the $20-$30 range.

Yours faithfully,

Jayhawk Capital


Thursday, August 27, 2015

Comments & Business Outlook

SHANGHAI, Aug. 27, 2015 /PRNewswire/ -- The bidding war for China Cord Blood Corporation between two A-share-listed rivals is almost set to come to an end: it seems Nanjing Xinjiekou Department Store Co., Ltd ("Nanjing Xinjiekou", 600682.SH) is having increasing odds to win the bid on China Cord Blood Corporation ("CO", NYSE: CO) among a number of candidates.

On August 26, five listed companies involved in the bid filed announcements respectively, together giving a clear picture of the takeover fight which is heading into the homestretch.

Before this, two listed-companies, namely Nanjing Xinjiekou (600682.SH) and Zhongyuan Union Cell & Gene Engineering Corp., Ltd ("Zhongyuan", 600645.SH) both announced that they were in negotiations to acquire CO's assets or equity interest. While Nanjing Xinjiekou intended to take over CO's entire assets and all businesses in Mainland China, Zhongyuan only planned to acquire a minority equity interest of CO.

CO, a U.S.-listed company that was incorporated in the Cayman Islands, primarily engage in the storage business of umbilical cord blood stem cells. It is the largest umbilical cord blood banking operator in China and the only cord blood banking operator with licenses in various Chinese cities including Beijing, Guangdong and Shandong.


Wednesday, August 26, 2015

Deal Flow

HONG KONG, Aug. 26, 2015 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) (the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that the Company has been informed that Magnum Opus 2 International Holdings Limited ("MO2"), an entity wholly owned by Mr. Yuen Kam, chairman of the board of directors of the Company, has acquired the outstanding shares (the "Shares") of  Excellent China Healthcare Investment Limited ("KKR SPV") from Brilliant China Healthcare Investment Limited (the "Seller") (formerly known as KKR China Healthcare Investment Limited).  KKR SPV was a wholly owned subsidiary of the Seller and the current holder of US$65 million in aggregate principal amount of the Company's outstanding 7% senior convertible notes due 2017 (the "KKR Notes").  Under the share purchase agreement, MO2 has paid a portion of the purchase price equal to US$80 million and has agreed to pay the remaining purchase price (approximately US$79.9 million and accrued interest and additional payment, if any) on or before October 28, 2015.  MO2 has also granted a charge on the Shares in favor of the Seller to secure its obligation to pay the remaining purchase price. Concurrently with the execution of the share purchase agreement, the Seller and Golden Meditech Holdings Limited, a Hong Kong listed company and a substantial shareholder of the Company ("Golden Meditech"), terminated the previously announced purchase agreement, dated as of May 4, 2015, in relation to the purchase and sale of the KKR Notes by Golden Meditech. 

The purchase price for the Shares is currently estimated to be approximately US$159.9 million plus interest accrued on the KKR Notes from April 27, 2015 to the date of payment of the remaining purchase price. The purchase price stated in the share purchase agreement is commensurate with the consideration that was payable by Golden Meditech under the previously announced purchase agreement.

The purchase price under the share purchase agreement is subject to possible adjustment in connection with (i) any distributions on the ordinary shares of the Company and (ii) any changes to the current offer price of $6.40 per ordinary share reflected in Golden Meditech's previously announced proposed "going-private" transaction involving the Company, in each case in accordance with the terms of the share purchase agreement.

Mr. Yuen Kam has also issued a letter of undertaking (the "Undertaking Letter") to Golden Meditech.  According to the Undertaking Letter, subject to certain conditions, Mr. Yuen Kam undertook to procure KKR SPV to enter into an option deed in relation to KKR SPV granting Golden Meditech a call option to acquire the KKR Notes for consideration equal to the purchase price under the share purchase agreement. 


Thursday, August 20, 2015

Comments & Business Outlook

First Quarter 2016 Financial Results

  • Revenues for the first quarter of fiscal 2016 increased by 7.8% to RMB165.4 million ($26.7 million) from RMB153.3 million in the prior year period.
  • –Basic3 and Diluted was 0.19 vs. last years same quarter of 0.37.

"During the reporting quarter, the market continued to contract and remained challenging. The decline in births, however, did not prevent us from recruiting more than sixteen thousand new subscribers, representing a year-over-year increase of 3.5%, which is in line with management's expectations." said Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation, "We will continue to deepen our existing channels and launch value-added products, utilize O2O channels to increase our conversion ratio, and foster greater customer loyalty by creating parents-children communities. Meanwhile, we continue to build up our team and marketing network for the Zhejiang market. In face of the market contraction in the Chinese lunar "Year of the Sheep", we are determined to achieve our subscriber target for fiscal 2016 by capitalizing on deepening of our existing sales channels and exploring new promotion platforms."


Thursday, August 6, 2015

Going Private News

HONG KONG, Aug. 6, 2015 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that its board of directors has received a non-binding acquisition proposal letter from Nanjing Xinjiekou Department Store Co., Ltd. (the "Potential Acquirer"), pursuant to which the Potential Acquirer offered to acquire all the Company's China business, including all of the Company's equity interests in its China subsidiaries and its assets and resources relating to its business in China (the "Proposal").  The purchase price offered is not lower than RMB6.0 billion, to be paid in cash or shares or a combination thereof.

The special committee of the Company's board of directors, in consultation with its legal and financial advisors, will carefully review and evaluate the Proposal. The Company cautions its shareholders and others considering trading its ordinary shares that no decisions have been made with respect to the Company's response to the Proposal. There can be no assurance that any agreement will be executed or that this or any other transaction will be approved or consummated.


Friday, May 8, 2015

Deal Flow

HONG KONG, May 8, 2015 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that the Company has been informed that Golden Meditech Holdings Limited ("Golden Meditech"), a Hong Kong listed company and a substantial shareholder of the Company, has entered into an agreement (the "CGL Agreement") to purchase the Company's outstanding 7% senior convertible note due 2017 with an aggregate principal amount of $25 million (the "CGL Note") held by Cordlife Group Limited ("Cordlife") and the ordinary shares of the Company owned by Cordlife (the "CGL Sale Shares"). Golden Meditech has also entered into an agreement (the "Magnum Agreement") to purchase the Company's outstanding 7% senior convertible note due 2017 with an aggregate principal amount of $25 million (the "Magnum Note") held by Magnum Opus International Holdings Limited ("Magnum").

The aggregate purchase price for the CGL Sale Shares, the CGL Note and the Magnum Note is currently estimated to be approximately $169.8 million plus interest accrued on the notes from October 3, 2014 to the date when the purchase is completed. The purchase price is subject to (i) applicable distributions on the ordinary shares made by the Company, if any, and (ii) any possible changes to the currently offered per ordinary share purchase price at $6.40 as reflected in Golden Meditech's previously announced proposed "going-private" transaction, in each case in accordance with the terms of the CGL Agreement and the Magnum Agreement. The completion of the purchase of the CGL Note and the CGL Sale Shares is subject to certain closing conditions, including Golden Meditech shareholder approval and Cordlife shareholder approval. The completion of the purchase of the Magnum Note is also subject to closing conditions, including Golden Meditech shareholder approval.


Thursday, April 30, 2015

Shareholder Letters

NEW YORK, April 30, 2015 /PRNewswire/ -- The following is an open letter sent April 30, 2015 to the Board of Directors of China Cord Blood Corp (NYSE: CO) from Jayhawk Capital.

We trust that the special committee of the independent directors of China Cord Blood Corp ("China Cord") will REJECT the extremely low privatization offer of $6.40 per share from Golden Meditech Holdings Co Ltd ("Golden Med"). Certainly, a going private transaction at $6.40 per share would greatly benefit Golden Med and Mr. Kam, the Chairman of both China Cord and Golden Med. It would not, however, be in the best interests of ALL shareholders. We are disappointed you have not acted so far on our proposal to have China Cord make a $150ml tender offer to repurchase shares and pay a $125ml special dividend. This tender offer and special dividend, along with an ongoing share repurchase program and a consistent dividend would benefit ALL shareholders, not just Golden Med and Mr. Kam. We are confident that these actions coupled with the impressive free cash flow generation (soon to be over $100ml per year) would drive this stock to above $20 per share, again benefitting all shareholders, not just Golden Med and Mr. Kam.

Cayman law requires that directors "must apply their minds and exercise independent judgment in the ordinary course of business". For the special committee of the independent directors of China Cord this means you must ensure you have all the facts to make an informed decision to support management's initiatives. As independent directors you must adopt due diligence and care to investigate the real commercial benefit for China Cord and ALL its shareholders regarding: a) repeated capital raising by China Cord, whether from third parties or from related parties; b) issuing large amounts of new shares for an employee compensation plan; and c) stockpiling excess cash with no viable commercial rationale for doing so. Some of the fiduciary duties owed by China Cord Directors' under Cayman law include: a duty to act in good faith in the best interests of the company; a duty to exercise their powers for the purposes for which they are conferred; a duty of trusteeship of the company's assets; a duty to disclose personal interest in contracts involving the company; a duty not to make secret profits from the Directors' office; and a duty to act with skill, care and diligence.

Many investors believe that Golden Med has a plan to effectively relist the shares of China Cord at $50-$60 per share through a merger with Zhongyuan Union Cell & Gene Engineering Corp Ltd (Shanghai ticker 600645) ("Zhongyuan"), a Chinese A-Share listed company in the stem cell business. Golden Med and Zhongyuan were suspended from trading April 27th (the date the take private offer was announced). Zhongyuan, through an investment banker, offered Jayhawk (which Jayhawk rejected) approximately $8 per share in February 2015. Below are key China Cord and Zhongyuan metrics.


Wednesday, April 29, 2015

Going Private News

HONG KONG, April 29, 2015 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that in response to the non-binding proposal letter dated April 27, 2015 received by the Company's Board of Directors (the "Board") from Golden Meditech Holdings Limited ("Golden Meditech"), relating to the acquisition of all of the outstanding ordinary shares of the Company not already owned by Golden Meditech in a "going private" transaction, the Board has formed a special committee of independent directors who are not affiliated with Golden Meditech (the "Special Committee") to evaluate such proposal. The Special Committee consists of Mr. Mark D. Chen, Dr. Ken Lu and Ms. Jennifer J. Weng, each of whom currently serves as an independent director on the Board, with Mr. Chen serving as the chair of the Special Committee. The Special Committee intends to retain advisors, including an independent financial advisor and U.S. and Cayman Islands legal counsel, to assist it in its evaluation.

The Company cautions its shareholders and others considering trading its securities that neither the Board nor the Special Committee has made any decision with respect to the Company's response to the proposal letter. There can be no assurance that any definitive offer will be made by Golden Meditech or any other person, that any definitive agreement will be executed relating to the proposed transaction, or that the proposed transaction or any other transaction will be approved or consummated.


Monday, April 27, 2015

Going Private News

HONG KONG, April 27, 2015 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced that its board of directors has received a non-binding proposal letter from Golden Meditech Holdings Limited ("Golden Meditech"), pursuant to which Golden Meditech proposes to acquire all of the outstanding ordinary shares of the Company not already directly or indirectly owned by Golden Meditech for US$6.40 per ordinary share in cash.

According to the proposal letter, which is dated April 27, 2015, the proposed transaction is intended to be financed with a combination of available cash resources of Golden Meditech and debt and equity capital. In connection with the proposed transaction, Golden Meditech also intends to acquire all of the 7% senior convertible notes of the Company pursuant to the terms and conditions of such convertible notes. A copy of the proposal letter is attached to this press release.

The Company expects that its board of directors will form a special committee of independent directors (the "Special Committee") to consider the proposed transaction. The Company also expects that the Special Committee will retain advisors, including an independent financial advisor and legal counsel, to assist it in its work. The Company cautions its shareholders and others considering trading its ordinary shares that no decisions have been made with respect to the Company's response to the proposed transaction. There can be no assurance that any definitive offer will be made, that any agreement will be executed or that this or any other transaction will be approved or consummated.


Thursday, March 19, 2015

Comments & Business Outlook

NEW YORK, March 20, 2015 /PRNewswire/ -- The following is an open letter sent March 19, 2015 to the Board of Directors of China Cord Blood Corp (NYSE: CO) from Jayhawk Capital.

As a substantial and long term shareholder (Jayhawk Capital has been a shareholder in the company since before it was listed on the New York Stock Exchange in 2009), we applaud you and the management team for the impressive results you have achieved in operating the company. On a fully diluted basis, Jayhawk Capital is the third largest non-affiliated shareholder at 9.1%. KKR owns 19.1% and Cordlife Group (a Singapore-based cord blood company) owns 13.4%. Golden Meditech and other company affiliates own 35.2%. China Cord has become the largest umbilical cord blood operator in China and the company has generated and is expected to continue to generate huge amounts of free cash flow as shown in the table below.


Free Cash Flow


Period

USD (thousands)

Notes

FY March 2014

$62,115

Actual

FY March 2015

$90,000

Jayhawk Estimate

FY March 2016

$101,000

Jayhawk Estimate

FY March 2017

$113,000

Jayhawk Estimate

This strong cash generation, however, has not been reflected in the stock price of the company. Using a 20x multiple of FY2016 (ends March 2016) cash flow would indicate that the stock price should be $16.81 per share. Even at this price, the stock would be trading at a discount to where the two main comparable companies, Zhongyuan Union Cell (Shanghai ticker 600645) and Cordlife Group (Singapore ticker CLGL), currently trade. Please note that this is the same Cordlife Group which owns 13.4% of China Cord and it would be accretive to their earnings if they were to acquire China Cord.

China Biologic (CBPO) is another U.S.-listed Chinese company operating in the blood industry whose stock price went from $9.80/share in October 2012 to $85.29/share as of March 18, 2015. CBPO is generating cash at a slightly lower rate than China Cord and is growing at approximately the same rate, but has an enterprise value of $2.1 billion USD, 8 times the $265 million USD enterprise value of China Cord.


Cash Balance


Period

USD (thousands)

Notes

FY March 2013

$240,565

Actual

FY March 2014

$302,892

Actual

FY March 2015

$392,892

Jayhawk Estimate

FY March 2016

$493,892

Jayhawk Estimate

FY March 2017

$606,892

Jayhawk Estimate

In an effort to maximize shareholder value, we urge the Directors of China Cord to:

  1. Approve the payment of an extraordinary cash dividend in the amount of $125ml USD.
  2. Approve a tender offer to repurchase $150ml USD worth of stock.
  3. Going forward, initiate a consistent share repurchase and/or dividend program with the available cash flow.

If the actions we suggest are taken, the common shareholders would receive a dividend of $1.18 per share and the stock price should be $22.56 using a 20x multiple of FY2017 cash flow (assuming the $150mm USD tender offer occurs at a price of $7.50 per share). The estimated cash balance at the end of FY2016 and FY2017 would be $220ml USD and $333ml USD, respectively. It is clear that, even after the extraordinary dividend and tender offer we request, there will provide plenty of cash to pay a large recurring dividend and establish an ongoing share repurchase program.

The reasons for the Board to consider and approve the above plan are summarized as follows:

1. Directors are under a duty to maximize shareholder value as part of acting in the best interests of the company. Given the very low valuation, the special dividend and tender offer are necessary to return value to the company shareholders.

2. The company has not provided a compelling reason to its shareholders for its need or determination to hold on to such a growing balance of un-used cash. Capital expenditures should be minimal going forward. The company spent significantly on capital expenditures over the past several years, building out ample capacity for the future. The acquisition of an additional license for expanding to a new province also does not appear to be a viable option.



Units Stored

Increase

Location

Capacity

30-Sep-14

FY 2015 (est)

Beijing

550,000

180,000

22,000

Guangdong

850,000

216,000

40,000

Zhejiang

500,000

10,000

6,300

3. $125ml USD special dividend is significantly less than the cash on hand and is not much more than only one year's free cash flow.

4. After the special dividend and tender offer, the company will still maintain a substantial cash balance that continues to increase substantially through operations.

5. The company has not declared a cash dividend since listing on the NYSE in 2009.

Jayhawk Capital believes that the time is right and it is appropriate for the company to take these actions to benefit all of the company's shareholders. We appreciate your attention to and consideration of this matter and we look forward to continued strong operating results from the company which, when combined with the dividend payments and share repurchases, will result in superior investment returns for committed, long-term shareholders such as Jayhawk.

Sincerely
Jayhawk Capital


Shareholder Letters

NEW YORK, March 19, 2015 /PRNewswire/ -- The following is an open letter sent March 19, 2015 to the Board of Directors of China Cord Blood Corp (CO) from Jayhawk Capital.

As a substantial and long term shareholder (Jayhawk Capital has been a shareholder in the company since before it was listed on the New York Stock Exchange in 2009), we applaud you and the management team for the impressive results you have achieved in operating the company.  On a fully diluted basis, Jayhawk Capital is the third largest non-affiliated shareholder at 9.1%.  KKR owns 19.1% and Cordlife Group (a Singapore-based cord blood company) owns 13.4%.  Golden Meditech and other company affiliates own 35.2%. China Cord has become the largest umbilical cord blood operator in China and the company has generated and is expected to continue to generate huge amounts of free cash flow as shown in the table below.


Free Cash Flow


Period

USD (thousands)

Notes

FY March 2014

$62,115

Actual

FY March 2015

$90,000

Jayhawk Estimate

FY March 2016

$101,000

Jayhawk Estimate

FY March 2017

$113,000

Jayhawk Estimate

This strong cash generation, however, has not been reflected in the stock price of the company.  Using a 20x multiple of FY2016 (ends March 2016) cash flow would indicate that the stock price should be $16.81 per share.  Even at this price, the stock would be trading at a discount to where the two main comparable companies, Zhongyuan Union Cell (Shanghai ticker 600645) and Cordlife Group (Singapore ticker CLGL), currently trade.  Please note that this is the same Cordlife Group which owns 13.4% of China Cord and it would be accretive to their earnings if they were to acquire China Cord.

China Biologic (CBPO) is another U.S.-listed Chinese company operating in the blood industry whose stock price went from $9.80/share in October 2012 to $85.29/share as of March 18, 2015.  CBPO is generating cash at a slightly lower rate than China Cord and is growing at approximately the same rate, but has an enterprise value of $2.1 billion USD, 8 times the $265 million USD enterprise value of China Cord.


Cash Balance


Period

USD (thousands)

Notes

FY March 2013

$240,565

Actual

FY March 2014

$302,892

Actual

FY March 2015

$392,892

Jayhawk Estimate

FY March 2016

$493,892

Jayhawk Estimate

FY March 2017

$606,892

Jayhawk Estimate

In an effort to maximize shareholder value, we urge the Directors of China Cord to:

  1. Approve the payment of an extraordinary cash dividend in the amount of $125ml USD.
  2. Approve a tender offer to repurchase $150ml USD worth of stock.
  3. Going forward, initiate a consistent share repurchase and/or dividend program with the available cash flow.

If the actions we suggest are taken, the common shareholders would receive a dividend of $1.18 per share and the stock price should be $22.56 using a 20x multiple of FY2017 cash flow (assuming the $150mm USD tender offer occurs at a price of $7.50 per share).  The estimated cash balance at the end of FY2016 and FY2017 would be $220ml USD and $333ml USD, respectively.  It is clear that, even after the extraordinary dividend and tender offer we request, there will provide plenty of cash to pay a large recurring dividend and establish an ongoing share repurchase program. 

The reasons for the Board to consider and approve the above plan are summarized as follows:

1. Directors are under a duty to maximize shareholder value as part of acting in the best interests of the company. Given the very low valuation, the special dividend and tender offer are necessary to return value to the company shareholders.

2. The company has not provided a compelling reason to its shareholders for its need or determination to hold on to such a growing balance of un-used cash.  Capital expenditures should be minimal going forward.  The company spent significantly on capital expenditures over the past several years, building out ample capacity for the future.  The acquisition of an additional license for expanding to a new province also does not appear to be a viable option.



Units Stored

Increase

Location

Capacity

30-Sep-14

FY 2015 (est)

Beijing

550,000

180,000

22,000

Guangdong

850,000

216,000

40,000

Zhejiang

500,000

10,000

6,300

3. $125ml USD special dividend is significantly less than the cash on hand and is not much more than only one year's free cash flow.

4. After the special dividend and tender offer, the company will still maintain a substantial cash balance that continues to increase substantially through operations.

5. The company has not declared a cash dividend since listing on the NYSE in 2009.

Jayhawk Capital believes that the time is right and it is appropriate for the company to take these actions to benefit all of the company's shareholders. We appreciate your attention to and consideration of this matter and we look forward to continued strong operating results from the company which, when combined with the dividend payments and share repurchases, will result in superior investment returns for committed, long-term shareholders such as Jayhawk.

Sincerely
Jayhawk Capital


Thursday, February 26, 2015

Comments & Business Outlook

Third Quarter 2015 Financial Results

  • Revenue Up 10.7% YOY to RMB166.7 Million ($26.9 Million)
  • Earnings per Ordinary Share  – Basic[3] and Diluted was $0.07 the same as last years same quarter.

"We recorded solid performance in the third quarter of fiscal 2015 with more than 17,600 new subscribers, representing strong year-on-year growth and a quarter-on-quarter improvement," stated Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation. "Our new subscriber growth in the December quarter reflects our recent increase in strategic marketing efforts in the second quarter of fiscal 2015. With the Company's cumulative subscriber base exceeding 425,000, we have further solidified our position as one of the largest cord blood banks on a global scale."

Ms. Zheng further commented, "In the near term, we continue to explore new promotion platforms while strengthening our existing marketing channels in order to deepen our market penetration in both Beijing and Guangdong, as well as gradually enrolling new hospitals in Zhejiang. We recently announced our new MOU with Cord Blood Registry in the US. This partnership will further our mission to deliver premium quality precautionary healthcare services to families as we continue to support patients and clients both domestically and abroad."


Wednesday, January 28, 2015

Notable Share Transactions

HONG KONG, Jan. 28, 2015 /PRNewswire/ – China Cord Blood Corporation (CCBC, NYSE: CO), China's first and largest umbilical cord blood bank, and Cord Blood Registry® (CBR®), the world's largest newborn stem cell company, today entered into a memorandum of understanding regarding their strategic collaboration in China and the United States. The two prominent cord blood banks will share data on cord blood collection, processing and storage to advance international standards. The companies will also work together under the memorandum, to develop a family disease registry for CCBC's clients in China and jointly support newborn stem cell-related clinical trials in the U.S. and China.

This important collaborative effort achieves a milestone in bringing the two largest cord blood banks in the world into close concert for the benefit of their client families, future patients and the stem cell clinical research community. It also presents an opportunity to aid families impacted by certain diseases across an international and racially diverse population. In the aggregate, the two companies have collected and stored samples from an estimated 1 million newborn children worldwide, accounting for nearly half of all cord blood units preserved globally.

"CBR and CCBC are both committed to bringing forward clinical applications of newborn stem cells for a host of conditions that could benefit from regenerative medicine," said Geoffrey Crouse, President and Chief Executive Officer of CBR. "Through this collaboration, we will be able to share our expertise and resources and improve mutual access to crucial research in China and the U.S. This first of its kind partnership is a significant step toward raising global awareness of the importance of newborn cord blood hematopoietic stem cell research."

Kam Yuen, Chairman of CCBC commented, "This memorandum brings together two cord blood banks that collectively serve approximately 1 million clients and represents the most significant joint effort to date in the global cord blood banking industry. Through this collaboration, we hope to create new possibilities to service clients and patients, and provide greater support to the stem cell clinical research communities in both China and the U.S."


Friday, September 5, 2014

Deal Flow

HONG KONG, Sept. 5, 2014 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, today announced that the Company's Compensation Committee (the "Committee") has approved an allocation of 5,840,000 restricted share units ("RSUs") to be issued to selected members (the "Potential Participants") of the CCBC management team.

In identifying the Potential Participants, the Committee took into account each individual's employment history, roles, responsibilities, and past and expected future contributions to the Company. Upon the actual grant of the RSUs (which is likely to take place on or before December 31, 2014), the Company plans to issue shares underlying the granted RSUs to a designated trust (the "Trust") to hold such shares in accordance with the rules of the Company's RSU scheme. The vesting of the awards and transfers of related shares out of the Trust are subject to the Potential Participants' fulfilling their respective performance targets as established by the Committee over the next several years.

As certain individuals among the Potential Participants are directors of the Company or the Company's subsidiaries, they and the Trust are regarded as connected persons of the Company's major shareholder, Golden Meditech Holdings Limited ("Golden Meditech"), under the listing rules of the Hong Kong Stock Exchange. Therefore, the grant of RSUs to such Potential Participants and the issue of shares to the Trust will only be made after Golden Meditech has obtained its independent shareholders' approval in compliance with the Hong Kong Stock Exchange's listing rules.

The RSU scheme, which was approved by the Company's shareholders at its 2010 Annual General Meeting (and amended in August 2014), allows a maximum of 7,540,687 RSUs (representing 10% of CCBC's shares outstanding as of February 18, 2011) to be issued.


Friday, August 29, 2014

Comments & Business Outlook

First Quarter Fiscal 2015 Financial Results

  • Revenues for the first quarter of fiscal 2015 increased to RMB153.3 million ($24.7 million) from RMB128.7 million in the prior year period.
  • EARNINGS PER SHARE. The terms of the convertible notes issued to KKR and Golden Meditech provide each party with the ability to participate in any Excess Cash Dividend[2]. Therefore, the calculation of basic and diluted EPS has taken into consideration the effect of such participating rights of RMB0.04 ($0.01) for the first quarter of fiscal 2015. Basic and diluted earnings per ordinary share for the first quarter of fiscal 2015 were RMB0.37 ($0.06).

"We began fiscal 2015 with another solid quarter, adding 15,548 new subscribers which represented a modest year-over-year increase," stated Ms. Ting Zheng, Chief Executive Officer of CCBC. "Through the implementation of sound marketing strategies that focus on service quality and premium branding, we continued to seize opportunities in the high-end segment of the market. As the majority of our new subscribers selected the one-time upfront payment option, our cash-flow generation remained robust and consistent."

Ms. Zheng further commented, "With our new facilities in Guangdong and Zhejiang largely completed, we are working through the final stages of their development to ensure they are fully operational as soon as possible. The new processing and storage capacity will effectively resolve our processing bottleneck in Zhejiang and allow us to gradually scale up our operations in this under-penetrated region. The additional capacity will also allow us to further develop and penetrate the Guangdong market, the area in which the majority of our new subscribers in the first quarter are located."


Monday, August 25, 2014

Deal Flow

HONG KONG, Aug. 25, 2014 /PRNewswire-- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, today announced that the Company has been informed that Magnum Opus International Holdings Limited ("Magnum"), a private vehicle that is controlled by CCBC Chairman Mr. Yuen KAM and involves the CCBC management team, together with Cordlife Group Limited ("Cordlife"), Singapore listed company and substantial shareholder of the Company, have agreed to purchase the Company's outstanding 7% senior convertible note due 2017 (the "Note") held by Golden Meditech Holdings Limited ("Golden Meditech"), CCBC's parent company, for a total consideration of approximately $88.1 million.

The Note was originally issued by the Company to Golden Meditech in 2012 with an aggregate principal amount of $50 million. Magnum and Cordlife are each obligated to purchase 50% of the Note, subject to customary closing conditions and satisfaction of all relevant approvals and consents, including but not limited to the approval of Golden Meditech's independent shareholders.


Thursday, July 31, 2014

Comments & Business Outlook

China Cord Blood Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

(Amounts expressed in thousands, except share data)

 

 

 

 

 

Year ended March 31,

 

 

 

Note

 

2012

 

2013

 

2014

 

2014

 

 

 

 

 

RMB

 

RMB

 

RMB

 

US$

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

16

 

380,490

 

526,123

 

572,857

 

92,152

 

Direct costs

 

 

 

(86,658

)

(106,621

)

(106,225

)

(17,088

)

Gross profit

 

 

 

293,832

 

419,502

 

466,632

 

75,064

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

 

(7,615

)

(8,459

)

(9,773

)

(1,572

)

Sales and marketing

 

 

 

(61,678

)

(93,684

)

(112,689

)

(18,128

)

General and administrative

 

 

 

(89,696

)

(108,045

)

(112,244

)

(18,056

)

Total operating expenses

 

 

 

(158,989

)

(210,188

)

(234,706

)

(37,756

)

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

 

134,843

 

209,314

 

231,926

 

37,308

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income/(expense), net

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

 

13,432

 

15,064

 

16,870

 

2,714

 

Interest expense

 

6

 

(3,287

)

(70,097

)

(70,075

)

(11,273

)

Exchange (loss)/gain

 

 

 

(1,343

)

(984

)

80

 

13

 

Dividend income

 

9

 

7,217

 

4,685

 

9,911

 

1,594

 

Others

 

 

 

737

 

203

 

2,212

 

356

 

Total other income/(expense), net

 

 

 

16,756

 

(51,129

)

(41,002

)

(6,596

)

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax

 

 

 

151,599

 

158,185

 

190,924

 

30,712

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

17(a)

 

(9,634

)

(38,543

)

(58,398

)

(9,394

)

Net income

 

 

 

141,965

 

119,642

 

132,526

 

21,318

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to non-controlling interests

 

 

 

(9,985

)

(7,195

)

(623

)

(100

)

Net income attributable to China Cord Blood Corporation’s shareholders

 

 

 

131,980

 

112,447

 

131,903

 

21,218

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share:

 

19

 

 

 

 

 

 

 

 

 

Attributable to ordinary shares

 

 

 

 

 

 

 

 

 

 

 

- Basic

 

 

 

1.79

 

1.49

 

1.60

 

0.26

 

- Diluted

 

 

 

1.79

 

1.49

 

1.60

 

0.26

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

- Net effect of foreign currency translation, net of nil tax

 

 

 

(1,653

)

1,296

 

8,299

 

1,335

 

- Net unrealized gain/(loss) in available-for-sale equity securities, net of nil tax

 

 

 

46,587

 

(9,120

)

57,708

 

9,283

 

Comprehensive income

 

 

 

186,899

 

111,818

 

198,533

 

31,936

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income attributable to non-controlling interests

 

 

 

(10,282

)

(7,172

)

(623

)

(100

)

Comprehensive income attributable to China Cord Blood Corporation’s shareholders

 

 

 

176,617

 

104,646

 

197,910

 

31,836

 

Management Discussion and Analysis

Revenues

Revenues increased by 8.9% to RMB572.9 million ($92.2 million) for the year ended March 31, 2014 from RMB526.1 million for the year ended March 31, 2013. The increase was largely attributable to the implementation of upward pricing adjustment and growing accumulated subscriber base, which outweighed the impact of the decrease in new subscribers. New subscribers for the current year decreased to 64,641, compared to 72,228 in the prior year, due to the decrease in number of newborns as a result of the Dragon year after-effect. As of March 31, 2014, total units stored for our subscribers increased to 376,623, compared to 311,982 as of March 31, 2013. There was no material early termination recorded for the two years ended March 31, 2013 and 2014.

Although there was a decline in new subscribers, we recorded a growth in revenues which was mainly driven by the Company’s growing subscriber base, as well as the new pricing imposed at the beginning of the current year. For the year ended March 31, 2014, processing fees and storage fees accounted for approximately 70.9% and 29.1% of total revenues respectively, compared to the revenue structure for the year ended March 31, 2013 in which processing fees and storage fees accounted for 75.4% and 24.6% of total revenues respectively. During the current year, processing fees and storage fees grew 2.4% and 28.7% to RMB406.2 million ($65.3 million) and RMB166.6 million ($26.8 million) respectively.

Net Income

Due to the reasons discussed above, our net income for the year ended March 31, 2014 amounted to RMB132.5 million ($21.3 million), compared to RMB119.6 million for the year ended March 31, 2013.


Wednesday, July 23, 2014

Joint Venture

HONG KONG, July 23, 2014 /PRNewswire-FirstCall/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, and Cordlife Group Limited ("Cordlife"), a multi-product healthcare company catering to the mother and child segment, today announced that the two companies have joined forces in assisting patients across the PRC, Singapore, Hong Kong, Indonesia, India, the Philippines and Malaysia to identify suitable cord blood matching units for stem cell therapy.

Under the Memorandum of Understanding signed between the two companies, Cordlife, on behalf of its patients who are in need of cord blood stem cell therapy, can facilitate the process by providing relevant information to CCBC, who will then perform searches for possible matching units among its donated cord blood samples in the PRC. For patients who reside in the PRC, CCBC may seek Cordlife's assistance or contacts to source possible cord blood unit matches in the relevant public cord blood registries in the regions where Cordlife operates, which include Hong Kong, Singapore, India, Indonesia, the Philippines, and Malaysia.

Mr. KAM Yuen, Chairman of China Cord Blood Corporation commented, "Both CCBC and Cordlife share a common vision which is to enhance people's lives through the widening of umbilical cord blood stem cells application services. Our proposed collaboration will assist families in the PRC and other parts of Asia who face difficulties obtaining a matching cord blood unit to widen their search, resulting in the increased likelihood of receiving treatment."

Mr. Jeremy YEE, Executive Director and Chief Executive Officer of Cordlife said, "We are glad to collaborate with CCBC in a joint effort to make cord blood stem cell therapy more widely available to our patients, particularly those who have difficulty finding a matching cord blood unit. Our two companies share a common goal of providing the best services, saving lives and improving quality of life for people in the Asia region."


Thursday, June 19, 2014

Comments & Business Outlook

Fourth Quarter 2014 Financial Results

  • Revenues for the fourth quarter of fiscal 2014 increased to RMB151.9 million ($24.4 million) from RMB133.0 million in the prior year period.
  • Basic and diluted earnings per ordinary share for the fourth quarter of fiscal 2014 were RMB0.46 ($0.07) vs. last years RMB0.32.

"Although fiscal 2014 was heavily affected by the drop in the number of newborns following the Dragon year, our team's dedicated effort resulted in more than 17,000 new subscribers in the fourth quarter," stated Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation.

"The geographical breakdown and payment mix of our new subscribers in the fourth quarter were comparable to previous quarters, resulting in a consistent level of cash flow. We continue to focus on sales and service efficiency to strengthen our market reputation. Heading into fiscal 2015, as our new facilities in Guangdong and Zhejiang become operational, we expect to increase our penetration in these regions, deepen our market reach and expand our overall leadership position in China's cord blood banking industry."


Tuesday, February 25, 2014

Comments & Business Outlook

Third Quarter2014 Financial Results

  • Revenues for the third quarter of fiscal 2014 increased 0.8% year-over-year to RMB150.6 million ($24.9 million).
  • Basic and diluted earnings per ordinary share for the third quarter of fiscal 2014 were RMB0.41 vs. last years RMB0.42

"Overall, we continued to deliver solid business performance in the third quarter. Although the numbers of newborns were still down over last year's Dragon year, the company achieved sequential quarterly growth in new subscribers and record quarterly revenue, attributable to our upward pricing adjustment implemented in the beginning of our current fiscal year, and from the sound execution of our sales and marketing strategy," stated Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation.

"In the third quarter, a one-time payment option remained the preferred choice among our new subscribers which contributed to our robust cash flow. As we approach the end of the current fiscal year, we remained focused on completing the capacity expansion at our Guangdong and Zhejiang facilities, which are in their final stages. With the new facilities coming on-line in the near future, we will strive to intensify our marketing effort and further deepen penetration within our key operating regions."


Friday, November 15, 2013

Comments & Business Outlook

Second Quarter of Fiscal 2014 Results

  • Revenues for the second quarter of fiscal 2014 increased by 10.3% to RMB141.6 million ($23.1 million) from RMB128.5 million in the prior year period.
  • Basic and diluted earnings per ordinary share for the second quarter of fiscal 2014 were $0.05 the same as the year prior.

"We are glad that our second quarter performance continued to track management's expectations with moderate sequential growth in new subscriber numbers, as the overall markets began to transition away from the Dragon year after-effect. During the second quarter, we continued to build brand awareness and emphasize service quality in our business. This aligns with our premium pricing initiative, backed by our AABB accreditation, that began in April this year," stated Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation.


Tuesday, August 27, 2013

Comments & Business Outlook

First Quarter of Fiscal 2014 Financial Results

  • Revenues for the first quarter of fiscal 2014 increased by 11.6% to RMB128.7 million ($21.0 million) from RMB115.3 million in the prior year period.
  • Earnings per Ordinary Shares Basic1 and Diluted was $0.07 vs. last years $0.07.

"We kicked off fiscal 2014 with an encouraging quarter as we managed to successfully add another 15,260 new subscribers to our subscriber base despite the seasonality effect and our upward pricing adjustments implemented during the quarter," stated Ms. Ting Zheng, Chief Executive Officer of CCBC. "A comprehensive network in Beijing, growing penetration in Guangdong, together with the hard work of our sales and marketing team were the primary factors behind our solid performance in the first quarter. At the same time, we have continued to implement and develop new strategies to strengthen our market presence and brand image."


Wednesday, June 19, 2013

Comments & Business Outlook

Fourth Quarter of Fiscal 2013 Financial Results

  • REVENUES. Revenues increased by 33.3% to RMB133.0 million ($21.4 million) in the fourth quarter of fiscal 2013 from RMB99.8 million in the prior year period,
  • GROSS PROFIT. Gross profit for the fourth quarter of fiscal 2013 increased by 38.8% to RMB106.1 million ($17.1 million) with gross margin expanded from 76.6% in the prior year period to 79.8%.
  • EARNINGS PER SHARE. The terms of the convertible notes issued to KKR and Golden Meditech provide each party with the ability to participate in any Excess Cash Dividend.[2] Therefore, the calculation of basic and diluted EPS has taken into consideration the effect of such participating rights equal to RMB0.00 ($0.00) for the fourth quarter of fiscal 2013. Basic and diluted earnings per ordinary share for the fourth quarter of fiscal 2013 were RMB0.32 ($0.05).

"Fiscal 2013 was a fruitful year concluded with eventful accomplishments," stated Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation. "We successfully added 72,228 new subscribers to our subscriber base, finishing the year by surpassing our original target by more than 12%, and our growing accumulated subscriber base exceeded the three hundred thousand mark at 311,982. These accomplishments were made possible by our years of market cultivation efforts and the 'Dragon Year' baby boom. Aside from setting new records of revenue and operating cash flow, we have also raised our investment in both Guangdong andShandong as we continue to expand our presence in China. In addition, we are pleased that our Beijing subsidiary received AABB Accreditation as our commitment toward high quality standards has been recognized, which motivates us to strive for further quality excellence for our Group as a whole."


Monday, October 22, 2012

Notable Share Transactions

HONG KONG, Oct. 22, 2012 /PRNewswire-FirstCall/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), the first and largest cord blood banking operator in China, today announced that the Company repurchased an aggregate of 6,041,980 ordinary shares for a total consideration of approximately $16.4 million since April 1, 2012. The total number of shares issued and outstanding as of the date hereof is 73,140,147, with 6,041,980 shares being held as treasury shares. On July 31, 2012, the Company adopted a new $20 million share repurchase mandate, as the prior $15 million share repurchase mandate expired. Under the existing mandate, which will expire on July 31, 2013, the Company has approximately $12.6 million available for repurchase


Wednesday, October 3, 2012

Deal Flow
HONG KONG, Oct. 3, 2012 /PRNewswire/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), the first and largest cord blood banking operator in China, announced that it has successfully completed the previously announced $50 million convertible note financing with Golden Meditech Holdings Limited ("Golden Meditech", 801.HK; 910801.TW), a leading integrated healthcare enterprise in China and the Company's largest shareholder.  The board of directors of CCBC has appointed Mr. Yuen Kam, currently the Chairman and Chief Executive Officer of Golden Meditech, as a director and Chairman of CCBC, effective October 3, 2012.  Ms. Ting Zheng will continue her role as a member of the CCBC board and Chief Executive Officer of the Company.

Tuesday, September 18, 2012

Deal Flow

HONG KONG, September 18, 2012 /PRNewswire-FirstCall/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), the first and largest cord blood banking operator in China and Golden Meditech Holdings Limited ("Golden Meditech", 801.HK; 910801.TW), a leading integrated healthcare enterprise in China announced that they entered into agreements under which Golden Meditech, is expected to invest $50 million into CCBC to support its further business expansion and to capitalize on China's fast-growing healthcare services industry.

The convertible note carries a 7% interest per annum and a total rate of return of 12% per annum. The convertible note holder can convert the convertible note into ordinary shares of the Company at a conversion price of $2.838. The total ordinary shares issuable represents approximately 15.5% of the enlarged share capital of the Company.

With the demand for cord blood banking services flourishing and the number of new subscribers continuing to rise, the additional capital will pave the way for CCBC to seize market opportunities and bring premium cord blood banking services to even wider public in China and any other untapped markets. CCBC is actively pursuing its China expansion strategy by building new storage facilities in Guangdong and establishing storage facility to service the Zhejiang market. The added capital infusion increases the Company's war chest to enable deeper and more rapid penetration into these regional markets, and be better prepared to pursue other opportunities as they arise.

Upon completion of the transaction, Mr. Yuen Kam, will be appointed as Chairman of CCBC and Ms. Ting Zheng will continue her role as the Chief Executive Officer of CCBC. Mr. Yuen Kam is currently the Chairman and Chief Executive Officer of Golden Meditech and has extensive experience in the healthcare industry of China.

"Golden Meditech has long been the largest shareholder of CCBC and currently holds 41.8% of CCBC. Our investment demonstrates our strong confidence in the prospects of China's cord blood banking industry and CCBC's market leadership," said Mr. Kam. "We believe in the potential embedded within CCBC. In serving as the Chairman of CCBC, I am honored to work with an experienced management team. With my support, I envision the CEO and her team will be able to broaden CCBC's reach so that more families can have the opportunities to protect their love ones through CCBC's premium healthcare services."

Ms. Ting Zheng, Chief Executive Officer of CCBC stated, "We are glad to receive such overwhelming and valuable support from our major shareholder who shares our vision and beliefs. We believe that CCBC will create a brilliant future under Mr. Kam's leadership and extensive experience in the healthcare industry."

In connection with the transaction, the Company has agreed to file a registration statement with the Securities and Exchange Commission with respect to the ordinary shares issuable upon conversion. Cowen and Company (Asia) Limited has delivered an opinion to the board of directors of the Company as to the fairness of the consideration to be received by the Company for the convertible note. The opinion analyzes fairness from a financial point of view and is based on the principal economic terms of the convertible note.


Thursday, August 23, 2012

Comments & Business Outlook

First Quarter of Fiscal 2013 Highlights

  • Revenues for the first quarter of fiscal 2013 increased by 31.9% to RMB115.3 million ($18.2 million) from RMB87.5 million in the prior year period.
  • Gross profit increased by 34.5% to RMB90.9 million ($14.3 million) from RMB67.6 million in the prior year period.
  • Operating income jumped by 44.4% to RMB44.4 million ($7.0 million) from RMB30.8 million in the prior year period. Operating margin expanded by 3.3 percentage points to 38.5%, as core operations benefited from economies of scale.
  • Operating cash flow for the quarter amounted to RMB136.9 million ($21.5 million).
  • Basic and diluted earnings per ordinary share for the first quarter of fiscal 2013 were RMB0.41 ($0.06) vs $0.08 in prior year.

"I'm pleased to announce that new subscriber numbers have, once again, set a new record by breaking the 16,000 mark to 16,460 for the first quarter of fiscal 2013, setting the stage for yet another astonishing year," stated Ms. Ting Zheng, Chairperson and Chief Executive Officer of China Cord Blood Corporation. "Not only are we setting new records based on revenues and operating income, but we are also gaining higher cash flows generated from increasing numbers of subscribers who chose to pay full-term storage fees upfront. Benefiting from the current "Dragon Year" baby boom, we are extremely excited about the results in this fiscal year."

Ms. Zheng further commented, "As we remain committed to increasing long-term shareholder value, the management team and I are encouraged to have had the Board of Directors authorize an increase in our annual share repurchase program from $15 million to $20 million, effective August 1, 2012. Upsizing the share repurchase program reflects not only our confidence in the underlying business, but also our long-term commitment to reward our shareholders. During the first quarter of fiscal 2013, the Company repurchased approximately 1.7 million ordinary shares and these shares were held by the Company as treasury stock."


Thursday, July 5, 2012

Notable Share Transactions

HONG KONG, July 5, 2012 /PRNewswire-Asia-FirstCall/ -- China Cord Blood Corporation (NYSE:CO) ("CCBC" or the "Company"), the first and largest cord blood banking operator in China, today announced that the Company repurchased an aggregate of 2,191,412 ordinary shares for a total consideration of approximately $6.2 million since August 2011. The total number of shares repurchased represents approximately 41% of the total $15 million authorized under the existing buyback program, which was authorized by the Board in August 2011, leaving approximately $8.8 million still available for repurchase.

Ms. Ting Zheng, Chairperson and CEO of China Cord Blood Corporation, stated that "Our most recent full-year results have once again demonstrated our ability to achieve and surpass corporate objectives and financial targets. Our strategy to emphasize upfront payment for cord blood banking services has already yielded tremendous success, as evidenced by the Company's greatly increased cashflow. We have also made good progress in capacity expansion and with the new Zhejiang operation. In light of our optimistic outlook and to demonstrate our commitment toward enhancing long-term shareholder value, we are delighted to seize this window of opportunity to buy back shares and remain committed to continue doing so as opportunities arise."


Tuesday, June 12, 2012

Comments & Business Outlook

Fourth Quarter of Fiscal 2012 Highlights

  • As a result of the change in operational strategy, fourth quarter new subscribers reached 14,336, a decrease of 8.3%, as compared to 15,641 in the prior year period and up 11.5% from the third quarter of fiscal 2012.
  • Revenues for the fourth quarter of fiscal 2012 increased by 5.4% to RMB99.8 million ($15.8 million) from RMB94.7 million in the prior year period.
  • Gross profit increased by 2.4% to RMB76.4 million ($12.1 million) from RMB74.7 million in the prior year period.
  • Operating profit decreased by 4.4% to RMB34.8 million ($5.5 million) from RMB36.4 million in the prior year period, as a result of enhanced sales force and marketing initiatives for operation expansion.
  • Net income attributable to shareholders increased by 11.3% to RMB29.2 million ($4.6 million) from RMB26.3 million in the prior year period.

"We are pleased by our accomplishments in fiscal year 2012 on several fronts," stated Ms. Ting Zheng, Chairperson and Chief Executive Officer of China Cord Blood Corporation. "For the full year, we exceeded our target of 50,000 new subscribers to add total of 53,924 new subscribers, expanding our total accumulated subscriber base to nearly 240,000. Such growth speaks well for our new marketing strategy, which targets high-end subscribers by offering premium services, and the well-received reception by the market."

"Furthermore, our new payment model with its emphasis on upfront payments and a higher processing fee per subscriber has strengthened our financial performance," continued Ms. Zheng. "The market's acceptance of this new payment model reinforces our conviction that we have developed a strong foundation for the Company's brand in each region upon which we are successfully expanding China Cord Blood's footprint. In addition to enhancing our strategic positioning, the new payment model has also strengthened our cash flow position as cash generated from operating activities almost doubled in fiscal 2012 from the prior year. All in all, fiscal 2012 concluded with the Company in an outstanding financial position and represented a successful first step towards repositioning our company as a premium healthcare service provider with recognized high-quality services."


Monday, April 30, 2012

Deal Flow

HONG KONG, April 28, 2012 /PRNewswire-Asia/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or "the Company"), the first and largest cord blood banking operator in China, today announced that it has successfully closed a US$65 million convertible debt financing with funds affiliated with KKR China Growth Fund L.P., a China-focused investment fund managed by Kohlberg Kravis Roberts & Co. L.P. (together with its affiliates, "KKR").  The transaction was first announced on April 12, 2012.

The convertible debt carries a 7% interest per annum and inclusive of the interest, a total internal rate of return of 12% per annum.  With a maturity of five years, the convertible debt holder can convert the convertible debt into ordinary shares of the Company at a conversion price of $2.838, subject to customary anti-dilutive adjustments.  On a fully converted basis, the total ordinary shares issuable represents approximately 23.8% of the enlarged share capital of the Company.

In connection with the transaction, the Company has agreed to file a registration statement with the Securities and Exchange Commission with respect to the ordinary shares issuable upon conversion.  The Company's senior executives and Golden Meditech Holdings Limited and its affiliates have entered into lock-up agreements regarding the ordinary shares currently held by them effective until KKR's investment in the Company decreases below a set threshold (subject to certain exceptions).

The Board of Directors of CCBC has appointed Mr. Julian Juul Wolhardt as a non-executive independent director, effective April 27, 2012. Mr. Wolhardt is a Member of KKR and focused on private equity transactions in the Greater China region.  Mr. Wolhardt is a Certified Public Accountant and Certified Management Accountant, with a bachelor's degree in accounting from the University of Illinois at Urbana-Champaign. 

Ms. Ting Zheng, Chairperson and Chief Executive Officer of CCBC stated, "We are extremely pleased with our new partnership with KKR.  Their investment in CCBC enhances our capital base and validates our long-term growth platform in China and potentially beyond. Partnering with one of the world's leading private equity firms also increases our visibility, broadens our shareholder base and enhances the long-term value for all CCBC shareholders."

"Our partnership represents a landmark investment in the China healthcare space," said Mr. Julian Juul Wolhardt.  "Together with CCBC, we are proud to serve the China market by offering high quality healthcare services that can positively impact the lives of many.  With our global expertise, we are dedicated to further strengthening CCBC's market leadership position."


Thursday, April 12, 2012

Deal Flow

HONG KONG & BEIJING--()--China Cord Blood Corporation (“CCBC”) (NYSE:CO) and Kohlberg Kravis Roberts & Co. L.P. (together with its affiliates, "KKR") announced that they have entered into agreements under which KKR China Growth Fund L.P., a China focused investment fund managed by KKR, is expected to invest $65 million into CCBC, the largest cord blood banking operator in China, to support its further business expansion and to capitalize on China’s fast growing healthcare services industry.

Cord blood contains large quantities of stem cells that, if stored properly, can later be used to treat life-threatening diseases. The applications of cord blood stem cells continue to expand, and can now be used to treat over 80 types of diseases, such as leukemia, lymphoma, thalassemia and inherited immune system disorders. This progress in medical research and clinical applications continues to raise public awareness of the benefits of storing cord blood.

Listed on the New York Stock Exchange since 2009, CCBC was the first licensed cord blood banking operator in China, providing collection, testing, processing, and storage services. CCBC runs the largest cord blood banking network in China in terms of geographical coverage, with exclusive licenses to service the city of Beijing, Guangdong Province and Zhejiang Province. This area covers more than 180 million people and has 1.9 million new births annually.

Ting Zheng, Chairperson and CEO of CCBC stated, “CCBC provides an important service to families across China who want to safeguard the lives and health of their newborns. We are delighted to have KKR as our partner. Our senior management team is most impressed by KKR’s global franchise and its strong local track record in China. KKR’s investment is undoubtedly a strong vote of confidence in our company, our management team and our vision for the future.”

“CCBC runs an impressive operation that meets stringent quality standards and provides a critical medical service to its customers. As we continue to build our China portfolio, we are excited to support a company that is dedicated to improving healthcare services and making a positive impact on lives in China,” said David Liu, Member of KKR and CEO of KKR Greater China.

“CCBC has an effective platform and its services will increase in value as its application expands,” said Julian Wolhardt, Member of KKR. “In addition, CCBC has an outstanding and dedicated management team who has worked together for almost a decade. We are very delighted to partner with them to build CCBC into a market leader in its field.”


Monday, July 11, 2011

Notable Share Transactions

HONG KONG, July 11, 2011 /PRNewswire-Asia-FirstCall/ -- China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), the first and largest cord blood banking operator in China, today announced that the Company repurchased an aggregate of 2,052,607 ordinary shares. The purchases were made at an average purchase price of $3.49 per share, for a total consideration of approximately $7.2 million betweenSeptember 2010 and July 2011. The total number of shares repurchased represents approximately 47.7% of the total authorized amount under the current buyback program, which will be effective until September 30, 2011. Approximately $7.8 million still remains available for purchases under the current buyback plan.

Ms. Ting Zheng, Chairperson and CEO of CCBC, stated, "Our operational and financial performance has demonstrated consistently strong growth. As our operations continue to expand across various regions withinChina, we will continue to capitalize on the growing business opportunities in China to maintain this growth momentum. We strongly believe that our current market valuation has yet to reflect our growth plans and intrinsic value. Thus, the management team considers the buyback program an excellent opportunity and in the best interest of the Company and its shareholders. Moving forward, we will continue to explore various means and initiatives to add value to the Company for our shareholders."