MGI Tech (SHA: 688114) announced the sale of 100% equity in its US subsidiary, Complete Genomics (CGI), to Swiss life sciences group Swiss Rockets for USD 50 million. The divestiture aims to avoid geopolitical risks while preserving MGI Tech’s access to core sequencing technologies in the US market through strategic licensing arrangements.
Transaction Overview
Item
Detail
Seller
MGI Tech (SHA: 688114)
Buyer
Swiss Rockets (Swiss life sciences group)
Asset Sold
100% equity in Complete Genomics (CGI)
Transaction Value
USD 50 million
CGI Operations
R&D, production, and sales of sequencing equipment and reagents (US market)
Post‑Closing Status
CGI integrated into Swiss Rockets; continues operating as US company
Ensures MGI Tech retains global technology rights, including US market access
Expanded Exclusive License Agreement (Concurrent)
Parameter
Detail
Licensor
MGI Tech
Licensee
Swiss Rockets
Licensed Technology
StandardMPS core gene sequencing platform
Territory
Exclusive rights in US and Canada
Commercial Implication
Swiss Rockets gains regional control; MGI Tech retains underlying IP
Strategic Implications
Geopolitical Risk Mitigation: The divestiture addresses US‑China technology tensions by removing direct Chinese ownership of a US‑based sequencing entity, potentially reducing regulatory scrutiny and export control risks.
Technology Continuity: The reverse licensing agreement ensures MGI Tech maintains unfettered access to CGI’s 205 patents and core technologies globally—preserving R&D capabilities and product development pipelines.
Market Access Preservation: Through the StandardMPS exclusive license, MGI Tech’s technology remains available in North America via Swiss Rockets’ commercial infrastructure, avoiding market exit.
Swiss Rockets Expansion: The acquisition provides Swiss Rockets with established US sequencing operations, manufacturing capacity, and an immediate foothold in the world’s largest genomics market.
Market Context
Factor
Impact
US‑China Biotech Tensions
Increasing scrutiny of Chinese‑owned genomics companies; MGI Tech’s divestiture follows similar moves by other Chinese tech firms
Genomics Market Consolidation
Swiss Rockets gains operational scale; MGI Tech focuses on non‑US markets while retaining technology upside
IP Strategy Innovation
Reverse licensing model may serve as template for other Chinese biotechs seeking US market access amid geopolitical constraints
Sequencing Competition
Illumina maintains US dominance; CGI/Swiss Rockets combination may challenge mid‑market segment
Forward‑Looking Statements This brief contains forward‑looking statements regarding transaction closing timelines, technology licensing continuity, and market access outcomes. Actual results may differ due to risks including regulatory approval delays, technology transfer challenges, and competitive dynamics in the sequencing market.-Fineline Info & Tech
By Fineline Cube