Biosensors International Group

[Musicwhiz]

Not vested.

Business Times - 18 Feb 2011

Biosensors to issue shares to two big investors

It'll raise $201m, placing out 216.3m shares to Atlantis and Ever Union

By NISHA RAMCHANDANI

STENT maker Biosensors International Group is looking to raise gross proceeds of some $200.81 million by placing out 216.32 million new ordinary shares to investment boutiques Atlantis Investment Management (Hong Kong) and Ever Union Capital.

Atlantis and Ever Union, which are independent of each other, will each subscribe to around 108.16 million shares at $0.9283 per share.

The placement price of $0.9283 represents a discount of about 10 per cent to the weighted average price of $1.0314 per share for trades done on the Singapore Exchange (SGX) from 9am on Feb 16 to 9.15am on Feb 17, when a trading halt was effected.

Biosensors, which is keen to grow its market share and revenue in China, said that the strategic alliance would be beneficial.

Atlantis manages investments in healthcare companies while Ever Union is an investment holding company with more than US$4 billion under management in sectors such as healthcare.

'Given Atlantis' and Ever Union's track record and expertise of investing in PRC healthcare companies . . . adding Atlantis and Ever Union as strategic investors will help the company penetrate the PRC market through the sharing (of) . . . their expertise and experience,' Biosensors said. 'The company may be able to leverage on their relationship with their investee and other companies to add strategic value to the company's business in the PRC.'

The shares will be issued in line with the general mandate obtained at an annual general meeting last July since the mandate authorises the company's directors to issue new shares, with the maximum number to be issued capped at 20 per cent of the total share capital.

The placement shares represent approximately 19.55 per cent of the existing issued and paid-up share capital of Biosensors and will represent about 16.35 per cent of the enlarged issued and paid-up share capital after the placement.

Up to 80 per cent of the proceeds from the placement will be used to finance new clinical trials, for capital expenditure and asset acquisitions, while the balance will be used as general working capital

[Musicwhiz]

Business Times - 16 Jun 2011

Hock Lock Siew
Chairman's 'sacrifice' a boon to Biosensors

By CHEN HUIFEN

AT BIOSENSORS International Group's analyst briefing on Monday, on its move to acquire full control of China-based stent maker JW Medical Systems (JWMS), Shandong Weigao's management representative was heard thanking Biosensors chairman Lu Yoh Chie not once, but twice, for his 'sacrifice'.

As for what that 'sacrifice' was, neither Weigao's CFO Jiang Qiang nor Mr Lu described it explicitly during the briefing. But one can infer what it was from the developments at Biosensors in recent months.

Last October, Mr Lu sold his 18 per cent stake in Biosensors to Chinese private equity firm Hony Capital at 88.88 cents a share. On Friday, before Biosensors announced its acquisition of the remaining 50 per cent in JWMS, shares of Biosensors were at $1.22.

At face value, Mr Lu appeared to have been shortchanged. But looking back, had he not divested his interest to Hony Capital, the JWMS deal may not have happened so quickly.

For some time now, Biosensors had been planning to buy out Weigao's remaining 50 per cent in JWMS, after buying half of the firm in 2007. There was even an agreement with Weigao to acquire the rest of JWMS through new share issues in two stages. But that eventually did not happen as Weigao, being a Hong Kong-listed firm, had to clear certain regulatory hurdles, and did not obtain approval from the Chinese authorities before the agreement expired.

On Weigao's end, the support to sell the rest of JWMS from the Chinese authorities never came, probably because Biosensors was a foreign company and not a very well known one then. But the strategic entry of Hony Capital last year added a Chinese dimension to the major shareholding. Hony Capital, after all, is a respectable firm with ties to Legend Holdings, the parent company of Lenovo. The subsequent addition of two China-focused boutique investment firms Atlantis Investment and Ever Union Capital strengthened the China angle, as the three parties collectively own more than a third of Biosensors.

With the approval of the Chinese government now in hand and the run-up of the share price, Mr Lu's earlier divestment does seem like a sacrifice on his part. But he told BT that he did not see it that way. According to him, being able to deliver the deal that he had in mind four years ago is in itself gratification.

'What's driving me is not just money only but to do what is right for the company, for the shareholders; and then to prove that I had a vision was something that was also equally important,' he said.

For sure, the founder of Biosensors won't be poor, having pocketed more than $170 million from his share sale to Hony Capital. On the other hand, having full control of JWMS is becoming more urgent as China's healthcare sector grows at phenomenal rates.

Just looking at JWMS, revenue has been rising at a compound annual growth rate of 36 per cent since 2007, while net profit went up 139 per cent between 2007 and last year. For the 12 months ended March 31 this year, JWMS accounted for US$19.3 million of Biosensors' net profit, or 29 per cent more than the sum from the year before. As a proportion of Biosensors' full year earnings of US$43.3 million, that is about 44 per cent.

With stent implants eligible for health reimbursement programmes in China since March this year, the demand for heart stents - flagship products of both Biosensors and JWMS - is expected to grow. According to a research report by Nomura, the Chinese drug-eluting stent (DES) market is estimated to be in the region of US$540 million to over US$1 billion last year.

Biosensors needs a closer relationship with Weigao and JWMS to get itself entrenched in the lucrative China market. By making JWMS a wholly owned subsidiary, Biosensors will be able to infuse technology transfer, while taking advantage of the cost effectiveness of JWMS's manufacturing facility. At the same time, it would be paving the road for its flagship BioMatrix DES, which is still awaiting the green light for launch in China. For JWMS, Biosensors would be an appropriate platform for its overseas ambitions. Weigao itself will own 16.2 per cent of Biosensors on completion of the acquisition.

What is needed next is the approval of Biosensors shareholders. While he is no longer a shareholder of the company he founded, Mr Lu said that he would continue to hold an executive role as its chairman.

'I'm still holding an executive role because I feel I still have some roles to play - although if you equate that to monetary incentives, a lot of people may think I have no more incentive to stay on.

'But I started this company, so I feel as if Biosensors is my son, a little baby . . . I will continue to play some role as long as I can render my contribution.'

(Not Vested)

[Musicwhiz]

Business Times - 28 Jun 2011

Biosensors eyes stent markets in China, Japan

It aims to increase current 27-30% share in China

(SINGAPORE) The Chinese market for drug-eluting stents, used to treat blocked arteries, is estimated to be worth more than US$1 billion by 2014, and Singapore's Biosensors International aims to increase its current 27-30 per cent share as a rival firm exits the sector, its chairman said.

Biosensors is also eyeing a 20 per cent market share in Japan by May 2012 through its licensee Terumo Corp, which makes the Nobori stent using the Singapore company's technology in exchange for royalty payments.

'US$500-600 million is more or less what I see is the market that is being served in China (currently),' Biosensors chairman Lu Yoh Chie told Reuters. 'In terms of number of cases or procedures, according to the estimates, by 2014 it would be double.'

Drug-eluting stents (DES) have a medicated coating to help prevent the reclogging of arteries after the stents are inserted in angioplasty procedures.

Mr Lu said that the Chinese DES market will grow in coming years because of the government's healthcare initiative, which reimburses stent treatments, as well as by the ageing population.

Biosensors announced earlier this month it plans to buy the remaining 50 per cent stake in Chinese stent maker JW Medical Systems (JWMS) from Hong Kong-listed Shandong Weigao Group Medical Polymer for S$625.4 million.

Biosensors is estimated to have a 27-30 per cent share of the overall DES market in China through JWMS and this could increase following the withdrawal of competitor Johnson & Johnson (J&J) from the DES business, Mr Lu said. 'With Johnson & Johnson pulling out, it's for us to grab. Just like everybody in the market, we have the ability to replace their business with ours,' he added. However, he declined to disclose Biosensors' market share target in China.

J&J announced earlier this month it will stop selling drug-eluting stents, a former profit driver for the diversified healthcare company that has stumbled due to safety concerns and fierce competition from rival products.

Nomura wrote in a report that Biosensors could gain market share from J&J's pull-out and it could also benefit from hiring the sales and technical staff affected. The brokerage has a buy call and S$1.50 target price on Biosensors.

In China, Biosensors competes through JWMS with local players such as MicroPort Scientific and Lepu Medical, as well as foreign companies like Boston Scientific and Medtronic.

In Japan, analysts noted that the market share of Nobori - the first locally-made DES by a Japanese medical technology firm following the approval by authorities - could be significant given Japanese physicians' loyalty to local companies.

'Our licensee Terumo has never sold DES into the Japanese market until now, after the approval. In the first 12 months from May this year, they expect to get around 20 per cent share of the DES market by volumes in Japan,' Mr Lu said. - Reuters

[old friend]

anyone hear any news? drop 14cts today, from $1.58 to close $1.44.

Thanks!

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anyone hear any news? drop 14cts today, from $1.58 to close $1.44.

Thanks!

[VIChris]

anyone hear any news? drop 14cts today, from $1.58 to close $1.44.

Thanks!

---

anyone hear any news? drop 14cts today, from $1.58 to close $1.44.

Thanks!

Great business, but at this moment it is overpriced.

[CityFarmer]

At the current price of $1.13, it had gone much lower than 52-week high of $1.7

I wonder what are the depressing factors for Biosensors?

[pubster]

Good day to all,

Biosensors will be having SGM on the 26 Jul 2012. During the meeting, they will be trying to pass 4 resolutions. One of them is the approval of the increase of the authorised share capital of the company. I did some search on the net but still do not fully understand this. May I know generally why do companies do this and how will this affect the existing shareholders?

Link for the SGX announcement: http://info.sgx.com/webcoranncatth.nsf/V...00024267D/$file/Biosensors_SGM_Notice.pdf?openelement

Thank you very much for any advice to my questions. Vested here.

Anyway, this is my first post and you have a great forum here. Enjoy your day.

[yeokiwi]

From wikipedia...
Definition of 'Authorized Share Capital'
The number of stock units that a publicly traded company can issue as stated in its articles of incorporation, or as agreed upon by shareholder vote. Authorized share capital is often not fully used by management in order to leave room for future issuance of additional stock in case the company needs to raise capital quickly. Another reason to keep shares in the company treasury is to retain a controlling interest in the company.

Also be called "authorized stock," "authorized shares" or "authorized capital stock."

Read more: http://www.investopedia.com/terms/a/auth...z20HIMsFC2


Biosensors has around 1.7billion shares issued currently.
Without the shareholders' approval, Biosensors can only issue another 2.4-1.7 = 0.7billion shares more to whoever.
With the approval, Biosensors can issue 0.7 +2.4 = 3.1 billion shares.

=> Company likely to issue new shares to get more money to run its business.
In the process, the current shareholders' stake in the company will be diluted if the new shares are issued at lower than current market price(which is most likely the case).

Or maybe a right issue for every shareholder..

[pubster]

Thank you very much for the prompt reply, yeowiki.

That does not sound very positive to me... Guess it need more cash for more acquisitions, R&D or growth...

From the FY2012 report, they have a fair amount of cash yet till now no dividends is given...

Guess I just stick around for a while longer to see how things unfold.

[Musicwhiz]

Thank you very much for the prompt reply, yeowiki.

That does not sound very positive to me... Guess it need more cash for more acquisitions, R&D or growth...

From the FY2012 report, they have a fair amount of cash yet till now no dividends is given...

Guess I just stick around for a while longer to see how things unfold.

If cash is being invested to generate rates of return which exceed their cost of capital, then it makes sense not to pay a dividend.

(Not Vested)