Shanghai Creation Investment Management Company (SCI) has acquired a stake in Zecotek Photonics subsidiary Zecotek Imaging Systems Pte Ltd for a consideration of $5 million, with a maximum equity position of 10 per cent.
The final valuation of the deal is contingent upon the execution of a previously announced MOU with a Chinese PET manufacturer. The investment in Zecotek Imaging Systems will be used to build out the necessary organisational and operational infrastructure, and add China-based management to deliver its patented imaging technologies to the Chinese medical PET industry.
Zecotek Photonics is a maker of photonics technologies for healthcare, industrial and scientific sectors listed listed on a number of stock exchanges, with its technologies servicing the healthcare, industrial and scientific markets. It’s operational footprint extends to Singapore and British Columbia, Canada.
Speaking on the investment, Dr. A.F. Zerrouk, Chairman, President, and CEO of Zecotek Photonics Inc., said, “The Shanghai Creation Investment Management Company is a highly respected medical technology fund that invests directly in or raises equity financing for medical technology companies operating in China.”
Observing that it had worked with over 30 international companies, including a major Chinese medical imaging company which recently ordered Zecotek’s patented LFS crystals for their third high resolution PET medical scanner, he said, “The cooperation agreement is a great opportunity for us to gain a leading role in delivering our patented imaging technologies to the world’s fastest growing medical imaging market.”
SCI claims to be amongst the most active investment funds and IPO consulting companies in China and will undertake to drive the incorporation of Zecotek Imaging China, recruit local management to execute the company programs and sales, and assist Zecotek Imaging in promoting its imaging technologies in China through SCI’s large network of partners and government organisations.
According to SCI, it plans to initiate a phased financing of Zecotek Imaging, starting with the $5 million investment that will be increased based on future valuations over the next two years.
Further to the equity financing, SCI will work with Zecotek to secure a grant from the local Chinese government authority for up to $3 million for Zecotek Imaging China.
The grant monies will be used to set up a local manufacturing facility for Zecotek Imaging China to grow LFS scintillation crystals boules. This will form a second source of crystal supply for Zecotek ensuring stability in supply, quality, performance and cost.