Neusoft Medical Signed Transfer Agreement with Philips to Acquire 25% Equities in Philips-Neusoft Medical Systems Joint Venture
Neusoft Corporation ("Neusoft", SSE: 600718), a leading IT solution and service provider in China, announced that Neusoft's wholly owned subsidiary, Neusoft Medical Systems Co., Ltd. ("Neusoft Medical") has signed agreements with Royal Philips Electronics and its affiliate company ("Philips") on the equities and assets transfer, intellectual property rights, contracted manufacturing and supply, components supply, customer service and support of Philips & Neusoft Medical Systems Co., Ltd. ("PNMS"). According to the agreement, Neusoft Medical will acquire 25% equities in PNMS held by Philips, and become the holding company of the original joint venture.
PNMS was jointly established by Neusoft Medical and Philips in 2004. Neusoft Medical and Philips held 49% and 51% equities in PNMS respectively. Upon the completion of the transaction, Neusoft Medical will hold 74% equities in PNMS, and therefore become the holding company of PNMS. In addition, Philips will purchase part of the equipments, instruments, and prototypes related to the development and pilot production of CT systems and high-voltage CT generators. Also, some staff for R&D and manufacturing of CT system and high-voltage CT generators will be transferred from PNMS to Philips.
According to the announcement, after the completion of the transaction, Neusoft Medical and the original joint venture will continue their businesses in R&D, production and sales of medical systems, such as CT scanners, MRI, x-ray apparatus, ultrasonic diagnosis apparatus, etc. Besides, Neusoft Medical and Philips will maintain a partnership based on the previous cooperation between both sides. In terms of the intellectual property rights, Neusoft Medical and Philips will both share the intellectual property rights of PNMS by means of co-ownership and license, while Philips will allow both Neusoft Medical and the original joint venture to use its background intellectual property rights within the current scope. Meanwhile, Philips promised to purchase ultrasonic products from the original joint venture on an exclusive basis, and further pledged to order CT products with a total value of no less than RMB 405 million Yuan within the following two years post transaction. In addition, Philips, the original joint venture and other related parties will continue to mutually supply medical equipment components, provide customer services and support, to meet the requirements of respective business development.
According to the announcement, the joint venture had fulfilled its mission over the past years, as evidenced by a large number of competitive products and intellectual property rights. The successful performance of PNMS has built solid foundation for both sides to further optimize their respective global deployment and improve their competitiveness. With this transaction, Neusoft and Philips will be able to develop new products based on their previous achievements in a more flexible manner in line with their respective strategies, which will further support their long-term strategic targets and plans and better help them cope with new opportunities and challenges in the global market.
It is reported that the transaction is estimated to take place before December 31st, 2013 or another date agreed upon by both sides. After the completion of the transaction, PNMS will be renamed and it will no longer use "Philips" in its name.