Biosensors International Group, (Biosensors) and Shangdong Weigao Group Medical Polymer Company Limited (Weigao), a leading manufacturer of single-use medical devices and consumables with well known brands in China, announced that they have entered into agreements for Biosensors to acquire an additional 30 percent interest in JW Medical Systems Ltd (JW Medical) and to grant Weigao an option to sell to Biosensors the remaining 20 percent interest in JW Medical by 30 July 2009. The acquisition of the further stake in JW Medical will enable Biosensors to establish a stronger presence in China following its acquisition of the first 50 percent interest in JW Medical in September 2007.
Mr Yoh Chie Lu, Chairman and CEO of Biosensors said, "This acquisition symbolizes a mutual commitment between Biosensors and Weigao to forge stronger relationships as long term strategic partners in Asia. The demand for drug-eluting stents continues to grow rapidly in China and having ownership of JW Medical will place us in a strong position to create maximum traction in this important and large market. Additionally, with Weigao now as a strategic shareholder of Biosensors, we will be able to leverage on its strength to become a leader in Asia, particularly in China."
Mr. Lu further commented, "Apart from the accretive impact of its financial results, JW Medical can also augment our existing resources and expand our operational capability, capacity, and distribution. Through JW Medical and Weigao, we are definitely better able to introduce our future technologies into the China market and develop strategies that can capitalize on the growth potential there."
After the required approvals are obtained, Biosensors will issue 120 million of its ordinary shares to Weigao in exchange for 30 percent of JW Medical. Biosensors will issue another 40 million of its ordinary shares if Weigao exercises its option to sell the remaining 20 percent of JW Medical to Biosensors.
Mr. Chen Xue Li, Chairman of Weigao group said, "China certainly offers explosive growth opportunities for companies with innovative technology and operational excellence. As shareholders of Biosensors now, we can leverage on Biosensors' leadership in interventional cardiology and enable Weigao to become a leader in the medical device industry in Asia. At the same time, we can also work closely with Biosensors and by utilizing our strengths in sales and marketing and knowledge of the Chinese market, we can bring Biosensors' new products and technology into the fast growing market in China more effectively and efficiently. We look forward to becoming a long-term shareholder and strategic partner of Biosensors to grow the business beyond China as well."
Under the agreement, Weigao also has the right to purchase up to 20 million additional new ordinary shares in cash, at a price to be negotiated, within 60 days from the date of the agreement. Weigao will own approximately 14.6 percent of the total outstanding shares of Biosensors assuming the issuance of an aggregate 160 million ordinary shares upon completion of the acquisition of the remaining 50 percent equity interest of JW Medical and the further purchase of 20 million new shares by Weigao.