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PW Medtech Group Limited Acquires Tianxinfu with a Total Consideration of RMB 803 Million

2014-07-02 18:04
-Enters Biological Materials Industry and Creates New Profit Growth Drivers
-Brings synergy through Outstanding Acquisition and Integration Capability

HONG KONG, July 2, 2014 /PRNewswire/ -- PW Medtech Group Limited ("PW Medtech" or the "Company" and, together with its subsidiaries, the "Group"; stock code: 1358), a leading medical device company in China, announced the equity transfer agreement and acquisition of Beijing Lima Tianxinfu Medical Devices Co., Ltd. ("Tianxinfu") on 20 May 2014. Health Forward Holdings Limited and Beijing Fert Technology Co., Ltd., the wholly-owned subsidiaries of the Company will acquire the entire equity interest in Tianxinfu with a total consideration of approximately RMB 802.6 million. The Company announced further information today.

Tianxinfu is a high-tech enterprise integrating research, development, production and sales service. Its main products include regenerative medical biological materials and orthopedic implant products. As a leading company in the industry, Tianxinfu's biological materials products are well recognized in China. Upon completion of the acquisition, Tianxinfu will become an indirect wholly-owned subsidiary of the Company and the Group will take over the market share of it in relation to biological materials products. Tianxinfu owns a total of 11 patents and has obtained 7 registration certificates for Class III medical devices. It has an extensive nationwide distribution network with over 150 distributors covering the major provinces in the PRC.

In consideration of the overall financial position and performance of Tianxinfu, the Company found the profitability of the Tianxinfu was attractive. For the past three years ended December 31, Tianxinfu recorded revenue of RMB 102.8 million, RMB127.9 million and RMB 150,9 million, net profit of RMB 65.6 million, RMB 74.8 million and RMB91.6 million, gross profit margin of 87.9%, 91.7% and 92.8%, and net cash generated from operating activities of RMB 76.3 million, RMB 73.6 million and RMB98.4 million respectively in 2011, 2012 and 2013.

Mr. Jiang Liwei, Chief Executive Officer of PW Medtech said, "Medical biological materials segment of the industry has huge growth potential and prospects. Upon the acquisition of Tianxinfu, the Group will enter into the biological materials segment and create new profit growth drivers. Further, the Group is also looking forward to expanding into more medical applications of the biological materials products in other areas with R&D investments and technology advancement in the future, The strategic acquisition will also bring synergy between the Company and Tianxinfu in research & development, production and distribution. Meanwhile, the Group will continue to focus on organic growth derived from its existing business segments and leverage on its outstanding acquisition and integration capability to grasp the development opportunity from the fast growing and high margin segment of China's medical device industry." 

Source: PW Medtech Group Limited

Related stocks: HongKong:1358

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