Alliance Boots has acquired a 12 per cent stake in Chinese pharmaceutical wholesaler Nanjing Pharmaceutical Company, increasing the health and beauty giant's presence in the country.

The £56 million deal makes Alliance Boots the second largest shareholder on the Nanjing Pharmaceutical board.

Following Alliance Boots' deal with US health and beauty giant Walgreens, executive chairman Stefano Pessina set out plans to expand its presence in China and Latin America. Alliance Boots first entered the Chinese pharmaceutical distribution market in 2008 in a joint venture with Guangzhou Pharmaceuticals Corporation.

The move is in line with chief executive Stefano Pessina's plans to expand Alliance Boots' presence in Latin America and China

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Mr Pessina said the latest deal with Nanjing Pharmaceutical represented "huge potential" to create a "great healthcare distribution network". "This agreement builds on the success we have already had in China and further strengthens our commitment to the country, as well as our willingness to play an active role in the evolution of the market in partnership with the authorities and key players," he said. "We believe that this strategic investment marks an important step in our long-term development in Asia."

The comments were echoed by Nanjing Pharmaceutical chairman Zhou Yaoping, who said the deal could help China's medical industry "reach global standards". "The co-operation with Alliance Boots is of great significance in the context of the slowing global economy and China's medical and healthcare reforms," he said.

"By introducing Alliance Boots' advanced supply chain management technology and experience, Nanjing Pharmaceutical will be able to improve its management practices, achieve greater performance, and help China's medical industry reach global standards, as well as support the pharmaceutical sector in establishing a vibrant social responsibility."