At the beginning of 2025, news of Shinva Medical once again came of selling hospitals. According to the "Shandong Finance Headlines" report, Shandong Shinva Medical Equipment Co., Ltd. (referred to as "Shinva Medical", 600587. SH) has officially listed and transferred 55% equity of its subsidiary, Shandong Xinhua Changguo Hospital Investment Management Co., Ltd. (referred to as "Xinhua Changguo" or "the target company"), for a transfer price of 113 million yuan.

01. Stripping off private hospitals for second-class epilepsy
Xinhua Changguo, which was officially listed and transferred by Shinva Medical, was established in 2012 with a registered capital of 120 million yuan. It mainly engages in investments in the pharmaceutical and medical service industries. Its wholly-owned subsidiary, Zibo Changguo Hospital (referred to as "Changguo Hospital"), is a privately-owned hospital specializing in epilepsy diagnosis, treatment, and traditional Chinese medicine preparations for epilepsy. When the hospital opened, the media reported that Changguo Hospital and Shandong Shinva Medical Equipment Co., Ltd. jointly established a hospital investment management company in response to the call of the new healthcare reform to encourage diversified medical services.

However, with the continuous changes in the medical market, it seems that Xinhua Changguo and its affiliated Changguo Hospital have not achieved the expected business results. According to the listing information, the operating revenue for 2024 is 4.7942 million yuan, and the net profit is 781000 yuan. As of November 30, 2024, the total assets of Xinhua Changguo were 143 million yuan, the total liabilities were 14.9788 million yuan, the operating income was 4.3947 million yuan, and the net profit was 695600 yuan. It is worth noting that the asset appraisal results show that the total assets and net assets of Xinhua Changguo are both valued higher than their book value, with a net asset appraisal value of 205 million yuan, which is more than 70 million yuan higher than their book value.

This equity transfer requires a one-time payment, and after the change registration is completed, the target company shall not use the word "Xinhua" in related technologies and products, nor shall it conduct business activities in the name of Shinva Medical's subsidiary. This regulation undoubtedly indicates that Shinva Medical is determined to completely divest its business related to Changguo Hospital and its investment management company.

02. Shinva Medical sells multiple hospitals
Shinva Medical was founded in 1943 and listed on the Shanghai Stock Exchange in September 2002. It is a health industry group that integrates four major sectors: medical equipment, pharmaceutical equipment, medical services, and medical commerce. According to the annual report data, Shinva Medical's main business revenue composition includes medical device manufacturing products accounting for 36.38%, medical commercial products accounting for 32.86%, pharmaceutical equipment products accounting for 21.05%, while medical services only account for 7.96%, and other businesses accounting for 1.75%. Although the proportion of medical services in the overall business is not high, Shinva Medical has made frequent actions in the medical services sector in recent years, which has attracted widespread attention from the industry.

The fate of Changguo Hospital is just a microcosm of many hospitals under Shinva Medical. In recent years, there have been continuous reports about the sale and closure of hospitals under Shinva Medical. Xinhua Changguo Hospital is not the first medical institution to be spun off by Shinva Medical in recent years.

Looking back at the development history of Shinva Medical, since 2017, the company has rapidly expanded through outward mergers and acquisitions and self construction, building a huge network of 18 hospitals. However, since 2018, the operating conditions of multiple hospitals under its umbrella have frequently encountered setbacks, prompting Shinva Medical to launch a series of hospital equity transfer actions.

In 2018, due to the termination of non-public offerings and unexpected fundraising, the construction project of the West Hospital of Zichuan District was shelved. Shinva Medical immediately decided to transfer the project through listing, aiming to reduce the company's operational risks, accelerate capital recovery, focus on the development of its main business, optimize resource allocation, and effectively reduce its asset liability ratio.

In 2019, Changsha Changheng Rehabilitation Hospital Co., Ltd., a subsidiary of Shinva Medical, announced bankruptcy liquidation on December 23 due to insolvency, with accumulated liabilities exceeding total assets by 14.12 million yuan, and facing multiple labor contract disputes and employee wage arrears.

In April 2020, Shinva Medical once again transferred 80% of the equity of Nanyang Orthopedic High tech Zone Hospital Co., Ltd. through listing. The company stated that this move aims to further reduce operational risks, considering that the hospital is still in the construction stage and requires a large amount of capital investment and operational management costs before stable income can be formed in the future.

On August 20, 2022, Shinva Medical announced that in order to further optimize its asset structure and resource allocation, it plans to transfer 12.85% of the equity of Shanghai Chenwei Zhongde Hospital Management Co., Ltd. jointly held by its two holding subsidiaries to natural person Chen Wei. In addition to holding stakes in multiple medical device companies, Chenwei Zhongde also holds stakes in multiple orthopedic hospitals. With the completion of the equity transfer, Shinva Medical has also given up some of its equity in these orthopedic hospitals.

In November 2024, Xiangyin Huaya Hospital Co., Ltd. (hereinafter referred to as "Xiangyin Huaya Hospital"), a subsidiary of Shinva Medical, once again became the debtor and was forcibly executed by the Furong District People's Court in Changsha, Hunan Province for 198892.00 yuan. As early as April 3, 2024, the Yueyang Municipal Health Commission announced that Xiangyin Huaya Hospital had "voluntarily applied for closure". Xiangyin Huaya Hospital is a key investment attraction project in Xiangyin County in 2014, jointly invested by Shinva Medical and Health Industry and other units with a total investment of 120 million yuan. It is a secondary comprehensive hospital integrating medical treatment, emergency care, health care, and rehabilitation. However, since its opening, the business situation of Huaya Hospital has not been optimistic. Although Shinva Medical has been continuously borrowing funds from the company and its subsidiaries to support its operations since 2019, the operating conditions of Huaya Hospital have not improved significantly, and there have been reports of unpaid employee salaries during this period.

On December 27, 2024, Shinva Medical officially announced the transfer of 43.3333% equity of Tangshan Hongxin Hospital Co., Ltd. through the Property Rights Trading Center at a base price of 13.1352 million yuan, marking another important move in hospital asset integration.

In fact, Shinva Medical first clarified its strategic intention of gradually and orderly withdrawing non-performing assets from the medical service sector in its 2021 annual report. Subsequently, news of selling hospitals continued to be heard.

The series of actions taken by Shinva Medical indicate that the company is gradually divesting its non-performing assets related to medical services, in order to focus more on the development of core business segments such as medical devices and pharmaceutical equipment. For example, on December 30, 2024, Shinva Medical announced its intention to acquire 36.1913% equity of Zhongqi Biotechnology for a price of 166 million yuan. According to relevant information, Zhongzhi Biotechnology is mainly engaged in the research and development, production, and sales of RNA molecular in vitro diagnostic kits, supporting instruments, and consumables. Its main products are a series of pathogen detection products for respiratory, reproductive, and intestinal infections. This acquisition indicates that Shinva Medical is more focused on developing its main business of medical devices.

Source: http://qixieke.com/Font/index/detailPage.html?id=3331-19