Split time and time again
1. Minimally invasive medical robots planned to be launched
On January 12th, according to China Electronics News, Shanghai Minimally Invasive Medical Robotics (Group) Co., Ltd. has signed a listing guidance agreement with CICC and plans to list on the Science and Technology Innovation Board.
Prior to this, in December last year, Minimally Invasive Medical announced that it was considering the possible spin off of its non wholly-owned subsidiary, Minimally Invasive Medical Robots, and its shares, for independent listing on recognized stock exchanges.
According to information on the official website, minimally invasive medical robots were established in 2014, with business covering five major tracks: endoscopy, orthopedics, vascular intervention, natural lumen, and percutaneous puncture.
According to the 2020 semi annual report of Minimally Invasive Medical, the net loss of the reportable segment of Minimally Invasive Medical Surgical Robots business in the first half of last year was $2.309 million.
Currently, the three flagship products of minimally invasive medical robots, Dragonfly Eye ™ DFVision ™ 3D electronic laparoscopy, Tumai ™ Toumai ™ Endoscopic surgical robot, Honghu ™ Skywalker ™ Joint replacement surgery robots have all entered the green channel for innovative medical devices by the * * Drug Administration.
It is understood that Tianzhihang, a domestic orthopedic surgical robot enterprise, has successfully landed on the Science and Technology Innovation Board and become a "domestic surgical robot" * * stock. Minimally invasive medicine is the second surgical robot enterprise to plan to land on the Science and Technology Innovation Board, following Tianzhihang.
According to data from Zhiyan Consulting, China's surgical robot industry has maintained a high growth rate in recent years. In 2019, the market size of the surgical robot industry was 619 million yuan, a year-on-year increase of 40.6%. The proportion of domestic surgical robots increased from 20.58% in 2016 to 52.16% in 2019.
However, there are still many problems to be solved in the field of surgical robots. According to the analysis of China Industry Information Network, the price of surgical robots is relatively high, and surgical costs are basically self funded, which has not been included in medical insurance. The popularity and utilization rate in China are still low.
In addition, the development of surgical robots in China still faces unfavorable factors such as price barriers for surgical robots to enter medical institutions, high surgical costs for robots, and monopolistic intellectual property restrictions on the research and development costs of domestically produced surgical robots.
2 Minimally Invasive Medical Multiple Splits
In addition to the spin off and listing of minimally invasive medical robots, on January 6th, Minimally Invasive Medical announced that in response to the proposal by Minimally Invasive Xintong Medical Technology Co., Ltd. to spin off and list, the company stated that eligible shareholders can subscribe to 1 reserved share for every 200 shares held in multiples at 4:30 pm on the record date (January 19th).
It is understood that on November 9th, Minimally Invasive Medical announced its proposal to spin off the shares of its subsidiary, MicroPortCardioFlowMedtech Corporation, and list them independently on the main board of the Hong Kong Stock Exchange.
Minimally invasive Xintong is mainly engaged in the research and development, manufacturing, and sales of instruments for the treatment of valvular heart disease.
According to the 2020 semi annual report of Minimally Invasive Medicine, its heart valve product - VitaFlow Catheter Aortic Valve System, obtained the registration certificate and production license from the * * Drug Administration in July 2019, and completed its first implantation after being launched on August 28, 2019. The 2020 semi annual report shows that the number of hospitals covered by the above system has rapidly increased after its launch, and some hospitals or departments have been developed by minimally invasive medical technology.
In addition, in 2019, Minimally Invasive Medicine also split its aortic and peripheral vascular intervention business - its subsidiary, Heart Pulse Medical, was listed on the Science and Technology Innovation Board.
According to the prospectus, Cardiovascular Medical ranks among the top in the field of interventional medical devices for aortic vessels in China. From 2016 to 2018, the revenue of Xinmai Medical was approximately 1.25 billion, 1.65 billion, and 2.31 billion respectively, with a compound growth rate of 136%. The sales revenue of its aortic stents accounted for about 80% of the total revenue.
For the reasons for the split and listing, taking Minimally Invasive Xintong as an example, on November 9th last year, Minimally Invasive Medical announced that the reasons for recommending the split of Minimally Invasive Xintong are as follows:
(a) Release the value of the rapidly growing spin off company and realize its investment value in the spin off group on an independent platform for spin off business;
(b) Separate the spin off business from the retained business, allowing shareholders and investors to separately evaluate the strategy, success factors, functional risks, risks, and returns of the spin off group and the group;
(c) The cost of business research and development is relatively high, and the product requires a period of time to complete clinical trials before it can be commercialized and begin to generate revenue. Spin off can allow the spin off group to directly enter the capital market for equity and/or debt financing to fund the continuous sales and marketing of its products;
(d) Enhance the image of the spin off group and increase its ability to attract investors to invest in the spin off group;
(e) To enhance the operational and financial transparency of the spin off company, and improve the corporate governance of the spin off company;
(f) This will enable the retaining group and the spin off group to have more centralized development, strategic planning, and better allocation of resources for their respective businesses.