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China National Pharmaceutical Group Corp. has signed up nine cornerstone investors that will subscribe to a combined US$195 million worth of shares in the company's US$1 billion Hong Kong initial public offering, a person familiar with the deal said Tuesday.

According to the person, the strategic investors are China Life Insurance Co. (LFC), Bank of China Ltd. (3988.HK), China Construction Bank Corp. (0939.HK), the Government of Singapore Investment Corp., Och-Ziff Capital Management LLC (OZM), Value Partners Group Ltd. (0806.HK), Martin Currie Investment Management Ltd., Bank of East Asia Ltd. (BKEAY), and China Chengtong Development Group Ltd. (0217.HK).

The Chinese company, also known as Sinopharm Group, is the country's largest pharmaceutical company by sales revenue and is planning to list in Hong Kong next month, according to a term sheet seen by Dow Jones Newswires on Monday.

It plans to sell 545.7 million shares, with an option to sell an additional 81.9 million depending on demand, the document said.

The state-owned company plans to use the proceeds to expand its distribution coverage and retail network, acquire pharmaceutical products, and upgrade its logistics and information technology systems, according to the term sheet.

Morgan Stanley (MS), China International Capital Corp., and UBS AG (UBS) are the bookrunners of the IPO.

-By Nisha Gopalan, Dow Jones Newswires; 852-2832-2343; nisha.gopalan@dowjones.com