BEIJING, Dec. 1, 2010 /PRNewswire-Asia-FirstCall/ -- China
Medical Technologies, Inc. (the "Company") (Nasdaq: CMED), a
leading China-based advanced
in-vitro diagnostic ("IVD") company, today announced that it
increased the size of its previously announced offering of
convertible senior notes. On November 30,
2010, the Company priced US$125
million in aggregate principal amount of convertible senior
notes due 2016 at an issue price of 100%. The transaction is
expected to close on December 6,
2010, subject to satisfaction of various customary closing
conditions. The Company has granted to the initial purchaser an
option to purchase up to an additional US$25
million principal amount of notes solely to cover
over-allotments. The Company intends to use the net proceeds from
the offering to repurchase, from time to time, its outstanding
convertible notes, to pay for its expenses associated with the
capped call transaction described below and for general corporate
purposes.
The notes will be the Company's senior unsecured obligations and
will rank equally in right of payment with all of its existing and
future senior unsecured indebtedness. The notes will bear interest
at the rate of 6.25% per year, payable semiannually on June 15 and December
15 of each year, beginning June 15,
2011. The notes will mature on December 15, 2016. Holders may initially convert
their notes into the Company's American Depositary Shares ("ADSs")
at a conversion rate of 68.6189 ADSs per US$1,000 principal amount of notes (representing
an initial conversion price of approximately US$14.57 per ADS and a conversion premium of
approximately 27.5% based on the closing sale price of the
Company's ADSs on the Nasdaq Global Select Market on November 30 of US$11.43 per ADS). The initial conversion
rate is subject to adjustment under certain circumstances.
The notes will be convertible into the Company's ADSs at any
time prior to the close of business on the business day immediately
preceding the maturity date of the notes.
The notes will be subject to redemption at the Company's option,
in whole or in part, on or after December
15, 2013 at a redemption price equal to 100% of the
principal amount of the notes to be redeemed, plus accrued and
unpaid interest, to, but excluding, the redemption date, if the
closing sale price of the Company's ADSs exceeds 130% of the
applicable conversion price for at least 20 trading days within a
period of any 30 consecutive trading days ending on the trading day
prior to the date on which the Company mails the redemption notice.
If the Company experiences a fundamental change, holders may
require it to purchase for cash all or a portion of such holder's
notes, at a price equal to 100% of the principal amount of the
notes, plus accrued and unpaid interest, to, but excluding, the
fundamental change purchase date.
In connection with the offering, the Company has entered into a
capped call transaction relating to US$100
million in principal amount of the notes with an affiliate
of the initial purchaser. The Company does not expect to
enter into additional capped call transactions in connection with
this offering. The capped call transaction is expected generally to
reduce the potential dilution of the Company's ADSs upon a
conversion of notes in the event that the market value per ADS of
the Company, as measured under the terms of the capped call
transaction, is greater than the strike price of the capped call
transaction (which corresponds to the initial conversion price of
the notes and is subject to certain adjustments similar to those
contained in the notes). The capped call transaction has a cap
price equal to approximately US$17.15
(50% above the closing sale price of the Company's ADSs on the
Nasdaq Global Select Market on November 30,
2010).
The Company has been advised that, in connection with hedging
the capped call transaction, the hedge counterparty or its
affiliates expect to enter into various derivative transactions
with respect to the Company's ADSs concurrently with, or shortly
after, the pricing of the notes and may, from time to time
following the pricing of the notes, enter into or unwind various
derivatives and/or purchase or sell the Company's ADSs in secondary
market transactions. These activities could increase (or reduce the
size of any decrease in) the price of the Company's ADSs
concurrently with or following the pricing of the notes, and may
also cause an increase or a decrease in the price of the Company's
ADSs following any conversion of notes and during the period prior
to, at or following the maturity date.
The notes and any ADSs issuable upon conversion of the notes,
including the ordinary shares represented by such ADSs, will not be
and have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), or any state securities law, and
may not be offered or sold in the United
States or to any U.S. persons absent registration under the
Securities Act, or pursuant to an applicable exemption from, or in
a transaction not subject to, the registration requirements of the
Securities Act and applicable state securities laws. The notes will
be offered only to "qualified institutional buyers" under Rule 144A
of the Securities Act.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy the notes or any ADSs issuable upon
conversion of the notes, nor shall there be any offer, solicitation
or sale of any notes or any ADSs issuable upon conversion of the
notes in any jurisdiction in which such offer, solicitation or sale
would be unlawful.
About China Medical Technologies, Inc.
China Medical Technologies, Inc. is a leading China-based advanced IVD company using
molecular diagnostic technologies including Fluorescent in situ
Hybridization (FISH) and Surface Plasmon Resonance (SPR) and an
immunodiagnostic technology, Enhanced Chemiluminescence Immunoassay
(ECLIA), to develop, manufacture and distribute diagnostic products
used for the detection of various cancers, diseases and disorders
as well as companion diagnostic tests for targeted cancer drugs.
The Company generates all of its revenues in China through the sale of diagnostic
consumables including FISH probes, SPR-based DNA chips and ECLIA
reagent kits to hospitals which are recurring users of the
consumables for their patients. The Company sells FISH probes and
SPR chips to large hospitals through its direct sales force and
ECLIA reagent kits to small and mid-size hospitals through
distributors.
Safe Harbor Statement
This press release contains forward-looking statements. These
statements constitute "forward-looking" statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and as defined in the U.S. Private Securities Litigation
Reform Act of 1995. These forward-looking statements can be
identified by terminology such as "will," "expects," "anticipates,"
"future," "intends," "plans," "believes," "estimates" and similar
statements. Such statements involve certain risks and uncertainties
that could cause actual results to differ materially from those in
the forward-looking statements. Further information regarding these
and other risks is included in the Company's filings with the U.S.
Securities and Exchange Commission, including its annual report on
Form 20-F. The Company does not undertake any obligation to update
any forward-looking statement as a result of new information,
future events or otherwise, except as required under applicable
law.
Contact
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Sam Tsang and
Winnie Yam
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Tel: 852-2511-9808
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Email: IR@chinameditech.com
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SOURCE China Medical Technologies, Inc.