Haier Biomedical (SHA: 688139) has announced the termination of its plan to acquire Shanghai RAAS (SHE: 002252), along with the associated share issuance for fundraising. The company cited the complex deal structure and the lack of a specific plan recognized by all parties involved as the reason for the termination, according to a stock exchange statement.
Background of the Merger Agreement
The two companies signed an absorption and merger agreement of intent in late December of last year. The plan involved Haier Biomedical absorbing and merging with RAAS through the issuance of shares listed in China to all RAAS shareholders, and raising matching funds by issuing additional shares. At the time, Haier Biomedical had a market cap of RMB 10 billion (USD 1.34 billion), compared to RAAS’s market cap of RMB 50 billion (USD 6.82 billion). Haier Biomedical’s stock resumed trading on January 7, 2025, after being suspended since December 31, 2024.
Company Profiles
Founded in 2005, Haier Biomedical made its debut on the Shanghai Stock Exchange’s Sci-Tech Innovation Board (STAR) in 2019. The company offers a range of products including blood separation equipment, testing equipment, and plasma consumables. RAAS, established in 1988, focuses on blood products. Both companies are controlled by China-based electronics and appliances firm Haier Group.
Significance of the Termination
The termination of the acquisition plan highlights the challenges in executing complex corporate transactions, particularly in the context of significant market cap differences and intricate deal structures. This development underscores the importance of clear and mutually agreed-upon plans in facilitating successful mergers and acquisitions.-Fineline Info & Tech
