(Yicai Global) Nov. 2 -- Qingyuan JDB Herbal Plant Technology Co., which is affiliated with China's largest herbal tea brand, has received state-owned capital invested by CPMC Holdings Ltd. [HK:0906] after a five-year long trademark dispute with Guangzhou Pharmaceuticals Corp.'s Wong Lo Kat tea brand.

CPMC Holdings said on Oct. 31 that it will put USD300 million (CNY2 billion) into Qingyuan JDB Herbal Plant Technology in exchange for a 30.58-percent stake in the tea giant. This deal puts the target company's valuation at CNY6.54 billion.

CPMC Holdings will pay half of the sum in cash and half by way of two-piece beverage aluminum cans that it will produce, supplying at least 70 percent of Qingyuan JDB Herbal Plant Technology's annual demand for Jia Duo Bao (JDB) beverage cans.

JDB Herbal Plant Technology's unaudited operating revenue was CNY6.48 billion last year, up 4.28 percent annually. Its after-tax net profit of CNY1.47 billion, marked an increase of 12.87 percent.

JDB trademark owner Wong Lo Kat Co., a private limited company registered in Hong Kong that is not connected with Wong Lo Kat herbal tea trademark owner and producer Guangzhou Pharmaceuticals, will transfer the JDB trademark, which is valued at CNY3 billion, to Qingyuan JDB Herbal Plant Technology for a 45.87-percent stake in the group.

"The parties will altogether combine the JDB brands, concentrates, supply and sales platform into an integrated operation platform," CPMC Holdings said. "The official investment in Qingyuan JDB Herbal by CPMC can increase [CPMC's] profitability and consolidate [its] leading position in the packaging industry. [CPMC] and JDB Group Companies will use their respective resource advantages to enhance the market

leading power of JDB herbal tea and promote the healthy and sustainable development of herbal tea industry."

Source: http://www.hkexnews.hk/listedco/listconews/SEHK/2017/1031/LTN20171031053.pdf