Jiuqiang Biotech (300406.SZ) shares in the participating company, Konatai plans to implement an equity restructuring

Zhitong Finance App News, Jiuqiang Biotech (300406.SZ) issued an announcement. The company recently received a notice from Zhongkonatai that due to the tight operating capital of Zhongkonatai and its original A1 round investor, Hangzhou Junze No. 1 Enterprise Service Partnership (hereinafter referred to as “Junze 1”), has initiated arbitration on the share repurchase matter (the repurchase price involved is RMB 8 million). In order to properly resolve the withdrawal of Junze 1, resolve the business difficulties, and promote subsequent financing, China Conatai plans to implement Power restructuring plan. According to the plan, the company plans to add 262.12 million yuan of registered capital to the subscription price of RMB 1 yuan/yuan of registered capital, with a total subscription price of RMB 262.12 million, all included in the registered capital; as an overall arrangement for this equity restructuring, the company and other original investors agreed to relinquish the repurchase rights and priority purchase rights under the “Shareholders' Agreement” signed by all parties in November 2021. After the restructuring is completed, the company will hold 6.3520% of Zhongkonatai's shares. The source of funding for this transaction is the company's own funds.

This equity restructuring is conducive to the proper resolution of the withdrawal and arbitration disputes of former Chinese investors in Konatai, stabilizing their equity structure, and creating conditions for their subsequent financing. In view of the current tight operating capital of China Konatai, the company faces the risk of recycling even if it is exercised. After careful evaluation, participating in this restructuring and obtaining a compensatory capital increase at nominal consideration is a realistic choice to maintain the company's existing investment value. China Konatai's field of in vitro diagnosis of circulating tumor cells is in synergy with the company's main in vitro diagnosis business. This restructuring is in line with the company's overall development strategy.