Photo courtesy of USM

The recipient Vo Xuan Boi Lam, a director of USM, on the same date executed a share transfer agreement with Lam.
The move follows Nissha's acquistion of 60 per cent of the shares of USM, a company incorporated in Vietnam, thereby making USM its consolidated subsidiary on May 20.

The purpose of the acquisition was to strengthen and enhance the efficiency of USM’s existing business, as well as to boost the geographic expansion of Nissha’s CDMO business for medical devices throughout the Southeast Asia region.

However, during the post-merger integration process and the preparation of Nissha's first consolidated financial results incorporating USM, it came to light that inappropriate accounting treatments centred on circular transactions that had been carried out at USM during the period before its acquisition. The company is currently investigating the matter under an investigation framework that includes external experts, to ascertain the relevant facts.

Nissha notes that the matter was initiated by USM’s officers and personnel before its acquisition and that the company has not been involved whatsoever. In light of these circumstances, Nissha carefully examined the feasibility of realising the benefits of the acquisition that it had initially anticipated, as well as the impact on its future corporate value. As a result, the company determined that it would be difficult to preserve and enhance the corporate value of the Nissha Group, and has therefore decided to transfer its 60 per cent stake in USM shares.

As a result of this share transfer, Nissha expects to record a gain or loss on the sale of shares of affiliates in both the non-consolidated financial results and consolidated financial results for the fiscal year ending December 31, 2026. However, the amount is currently being assessed, and the company will promptly announce any matters that should be disclosed in the future.

USM manufactures and sells products such as stents used in cardiology (devices used in catheter-based treatments that are minimally invasive) and devices used in orthopaedics. It has a vertically integrated system in place which encompasses processes spanning from product design and development to regulatory approval, manufacturing, and sales, giving the company a competitive edge in terms of pricing.