Dehaier Medical Systems Ltd., which develops, markets and sells medical devices and wearable sleep respiratory products in China and international markets, today announced that it entered into a definitive securities purchase agreement (the "Agreement") with Hangzhou Liaison Interactive Information Technology Co. Ltd. ("Liaison Interactive" or the "Purchaser"), a publicly listed company on the Shenzhen Stock Exchange (Trading Ticker: 002280) pursuant to which the Liaison Interactive has agreed to purchase 11,111,111 restricted common shares of the Company (the "Shares") for an aggregate of US$20,000,000 (the "Purchase Price"). The Purchase Price is US$1.80 per share, which represents a 35% premium to Dehaier Medical's closing price of $1.33 on April 27, 2016.
In consideration of the payment by the Buyer of the Purchase Price, the Buyer and its designees will also receive warrants to purchase 1,000,000 restricted common shares of the Company at a purchase price of US$2.20 per share (the "Warrants"). The Warrants are exercisable by the Buyer or its designees in whole or in part and are exercisable at any time after the Closing.
The Shares issued to the Purchaser have not been and are not being registered under the 1933 Act, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder or (B) the Buyer shall have delivered to the Company an opinion of counsel, in a form reasonably acceptable to the Company, to the effect that such Shares to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration. Closing under the Agreement is subject to compliance with customary closing conditions and is anticipated to occur on or before June 30, 2016.
"The Liaison Interactive investment dramatically improves our ability to expand our wearable medical device business and to launch other new smart wearable devices and mobile medical solutions over the next few years," said Mr. Ping Chen, Chief Executive Officer of Dehaier Medical. "The investment also helps optimize our overall strategies, increase our market penetration and strengthen our competitiveness in the medical wearable device segment.
"Liaison Interactive is committed to providing mobile internet products and services for its customers, including operation systems and software solutions platform, game publishing, distribution and smart wearable devices, which are currently a major focus of its business. Liaison Interactive entered the virtual reality ('VR') smart terminal market in 2015, acquiring 'Avegant Glyph' brand of hardware and software products. 'Avegant Glyph' is a retina glasses using VR technology, providing users ultimate visual experiences. We believe that by investing in the Company, Liaison Interactive can open up and further expand its strategic presence in the smart hardware space within the medical field.
"Dehaier Medical, focusing on smart wearable medical devices and services for OSAS patients, has cooperated with hundreds of medical institutions in China and is attempting to expand into the individual customer-oriented smart hardware market. By leveraging Liaison Interactive's extensive customer base in the Chinese mobile internet market, Dehaier anticipates growing its market share in China. It is the exact type of collaboration that we would anticipate from a strategic investor like Liaison Interactive, and we believe it will lead to a new revenue stream for us in the future."
Source : finance.yahoo.com