China Nepstar Chain Drugstore Reports One-time Non-recurring Penalty Payment
SHENZHEN, China, Aug. 4 /PRNewswire-Asia-FirstCall/ -- China Nepstar Chain Drugstore Ltd. (NYSE: NPD) ("Nepstar" or "the Company"), the largest retail drugstore chain in China based on the number of directly operated stores, today announced that the State Administration of Foreign Exchange imposed on the company a one-time non-recurring penalty in the amount of RMB25.5 million (US$3.8 million) for the conversion of approximately US$349 million net proceeds from the initial public offering into Renminbi in January 2008 without evidence of business operations at the time of the conversion by Nepstar Commerce Ltd, Nepstar Electronics Ltd, Nepstar Wisconsin Trading Ltd, and Nepstar Jinfu Logistics Ltd, the four investment holding companies wholly owned by the Company in mainland China, the four being the recipients of China Nepstar's IPO proceeds as foreign investment. The conversion was made at an average exchange rate of 1 U.S. dollar to RMB7.33. The Company is expected to make the payment of the penalty within 15 days.
The Company will host a conference call to address questions related to the penalty on August 4, 2010 at 9:00 a.m. Eastern Daylight Time / 9:00 p.m. Beijing Time. Interested parties may participate in the conference call by dialing +1- 877-407-9210 (North America) or +1-201-689-8049 (International) approximately f