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(Sharecast News) - Hutchison China MediTech, trading as 'Chi-Med', announced on Tuesday that Hutchison Whampoa Guangzhou Baiyunshan Chinese Medicine Company (HBYS) - its 50-50 joint venture with Guangzhou Baiyunshan Pharmaceutical Holdings - has agreed the planned return of its remaining 34 years land-use rights on its 30,000 square metre unused site in Tong He Town with the Guangzhou government.
The AIM-traded firm said the site is located in an area of Guangzhou about six kilometres from the city center, which would be rezoned from industrial to commercial and residential use.
It said the agreement signed between HBYS and the Land Development Centre of Guangzhou provides that HBYS would return the site to the government for cash compensation of up to $95m (£75m).
Under the agreement, HBYS would receive the compensation in several stages over a period of about a year, as all surrender procedures were met and the transaction progressed to completion.
"The return of HBYS plot 2 has no impact on the operations of HBYS," Chi-Med said in its statement.
"The joint venture continues to operate manufacturing facilities at a second, 59,000 square meter, nearby site in Baiyun District, Guangzhou, as well as a large new factory, on a 230,000 square meter site, in Bozhou, Anhui Province."
At 1355 BST, shares in Hutchison China MediTech were flat at 365p.
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