At present, An Kang Tong, a subsidiary of Nanjing Cenbest (hereafter “Cenbest”) serves a huge customer base with 5.78 million customers, making it the unarguable largest home-based senior care service provider in China. And there is more.

On June 3, Cenbest published a new statement which unveiled that Shanghai Hulian Telemedicine Network System Co., Ltd. (Shanghai Hulian, fully-owned by An Kang Tong) was seeking for a controlling share in Nanjing Hekang Smart Senior Care Industry Co., Ltd. (hereafter “HSSCI”) at a total price of RMB 112.2 million. The deal consists of two parts: (1) Shanghai Hulian obtained 20% of HSSCI’s equity with RMB 44 million of cash; (2) Shanghai Hulian further contributed RMB 68.2 million as subscribed capital of the increased registered capital. After the deal was closed, Shanghai Hulian would possess 51% of the equity of HSSCI.

In effect, although growing prosperous based on department stores, Cenbest has already been engaged in the comprehensive health industry. In 2016, Cenbest made a number of acquisitions, including Shangdong Cord Blood Bank, An Kang Tong, Natali (an Israeli home-based senior care company) and the nursing company A.S Nursing. As one of the earliest companies to enter the home-based senior care industry in China, An Kang Tong currently serves a customer base with 5.78 million customers and has handled over 200 million service calls, becoming the largest home-based senior care service provider in China.

In addition, the acquired HSSCI is also a pioneering company in the home-based senior care industry. The statement showed that HSSCI started its business in 2011 and entered the home-based smart senior care industry in 2013. In the first quarter of this year, HSSCI achieved an operating revenue of RMB 13.26 million (unaudited), with a net profit of RMB 3.1 million. In respect of the acquisition and capital increase, the opposite party of the deal made a pledge to Cenbest that, after deduction of non-recurring profit and loss, the net profit of HSSCI in 2017, 2018 and 2019 will reach respectively no less than RMB 15.88 million、22.28 million and 31.28 million.

According to information, HSSCI’s senior care business covers many Chinese provinces and cities, such as Fujian, Henan and Chongqing, serving over 600,000 customers. While, An Kang Tong now operates business in over 20 Chinese provinces and cities, including Beijing, Shanghai, Tianjin, Jiangsu and Anhui. Besides, An Kang Tong and HSSCI share a similar business model, with their business areas complementary to each other. Insiders said that after the deal, Cenbest could further expand the coverage of its home-based senior care business and customer base, leading to stronger scale-effect of business and more enhanced leading position in the industry.

On June 9, the two parties held a signing ceremony at the headquarter of Sanpower Group for investing in shares, when Bu Jiangyong, Chairman of An Kang Tong, and Zhou Gongwei, Founder of HSSCI signed an agreement. This was also witnessed by Yuan Yafei, Chairman of Sanpower Group, Yang Huai Zhen, Chairman of Cenbest, as well as members of HSSCI’s founding team, such as Hu Xiaodong and Yu Yan.

On June 9, the two parties held a signing ceremony at the HQ of Sanpower Group

Chairman Bu Jiangyong explained that both An Kang Tong and HSSCI strived for providing home-based smart senior care services for the elderly, and possessed business advantages in different regions. The move will help integrate the senior care resources of An Kang Tong and HSSCI to further accelerate Cenbest's expansion into home-based senior care service industry, improve its business layout and overall strength and competitiveness, as well as help drive its business in medical and senior care service businesses.