BEIJING, Nov. 29, 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
proposes to offer, subject to market and other conditions, up to
US$100 million in aggregate principal
amount of convertible senior notes due 2016 in a private placement.
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 Company expects to grant the initial purchaser an option to
purchase up to an additional US$25
million principal amount of notes solely to cover
over-allotments. 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 interest
rate, conversion rate and other terms of the notes will be
determined at the time of pricing of the offering.
In connection with the offering, the Company expects to enter
into a capped call transaction relating to US$100 million in principal amount of the notes
with an affiliate of the initial purchaser. The capped call
transaction is expected generally to reduce the potential dilution
of the Company's American Depositary Shares ("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 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 proposed to be offered, 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
the conversion of the notes, nor shall there be any offer,
solicitation or sale of any notes or any ADSs issuable upon the
conversion of the notes in any jurisdiction in which such offer,
solicitation or sale would be unlawful. The Company gives no
assurance that the proposed offering can be completed on any
terms.
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.