Gelonghui December 11丨Xinwei Medical-B (06609.HK) announced that on December 11, 2023, the company signed an equity transfer agreement with the buyer. Based on this, the company conditionally agreed to sell all of its shares in Shenji Medical to the buyer at a total cost of RMB 9 million. After the handover, the company will no longer have any interest in Shenji Medical, and the company will no longer be a subsidiary of the company.
Shenji Medical is a limited company incorporated in China and a wholly-owned subsidiary of the company. The company mainly focuses on medical device development that relies on computer-aided technology. Shenji Medical was founded by the company and led by Li Meng and Xing Tingyu (each as a buyer). After the handover, the Company will no longer have any interest in Shenji Medical, and the company will no longer be a subsidiary of the Company.
Since its establishment, Shenji Medical has begun to research and develop potential robotic medical devices. As of the announcement date, no medical devices under development have entered an advanced stage due to various unforeseen or unexpected difficulties encountered during the development process. The Group must invest significant resources to commercialize such medical devices, and there is no guarantee that such products can be successfully developed and commercialized.
Continued investment in Shenji Medical and its R&D work will also further diversify resources in the Group's core business (i.e. neurological intervention and medical equipment). Therefore, the board of directors believes that it is appropriate to sell Shenji Healthcare through management buyouts through existing employees, with the support of experienced investors in the biotechnology field.
After delivery, it is expected that Shenji Healthcare will not compete with the group. Shenji Medical will engage in research and development of intelligent surgical equipment, and the Group will not and currently has no plans to develop the same or similar medical equipment in this field. After the sale is completed, the company plans to allocate internal resources to the Group's core business and focus on medical device development and commercialization in the field of neurological intervention. The Group will continue to develop the products under development as described in the interim report published by the Company on September 21, 2023, and it is anticipated that the sale will not have a significant adverse impact on the Group's business operations and financial position.