US-based speciality health and performance retailer GNC has entered a strategic partnership and joint venture (JV) agreement with the Chinese pharmaceutical company Harbin Pharmaceutical Group Holding (Hayao).

According to the agreement, Hayao will invest nearly $300m in GNC and become a single largest shareholder in the company.

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Under the JV agreement, GNC and Hayao will manufacture, market and distribute GNC-branded products in the Chinese retail market.

Subject to regulatory approvals in the US and China, the transaction is expected to close in the second half of this year.

“Hayao’s investment in GNC is a testament to the strength of our brand and the tremendous global opportunity ahead, including in China.”

GNC chief executive officer Ken Martindale said: “Today’s announcements represent important and exciting steps in our efforts to optimise our capital structure and build on our recent momentum as we position GNC to drive growth, improve financial performance and enhance long-term shareholder value.

“Hayao’s investment in GNC is a testament to the strength of our brand and the tremendous global opportunity ahead, including in China.

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“By partnering with Hayao and pursuing plans to amend and extend our term loan facility, we enhance our capital structure and financial flexibility and establish a strong platform for growth in the Chinese market.”

GNC also noted that it is planning to amend certain terms and extend the maturity date of its existing term loan facility due March next year.

Hayao chairman Zhang Zhenping said: “GNC is one of the most recognised health and wellness brands globally. We are excited about the opportunity to partner with Ken and his leadership team to drive long-term value creation in all markets in which Hayao and GNC operate.

“In China, we are confident that we can leverage Hayao’s leadership to accelerate the company’s growth and expansion and deliver GNC products and solutions to millions.”

Upon completion of the deal, Hayao will own approximately 40% in GNC.