Jimin Health subsidiary receives 183 million yuan in capital increase. The strategic investor was established less than a year ago, with no revenue last year and a net loss of 2.35 million yuan.

MaticHoleFiller · 2026-03-26T15:52:54+00:00

Jimin Health announced that its subsidiary, Ezhou Second Hospital, will introduce Hubei Changhe Military-Civil Innovation as a strategic investor. The latter plans to increase its capital by 183 million yuan, holding a 40% stake. Although Jimin Health has waived its pre-emptive subscription rights and still maintains a 60% controlling stake to promote asset revaluation and financial support, there are certain uncertainties and risks associated with the transaction.

MaticHoleFiller

2026-03-26 15:52:54

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On March 17, Jimin Health (SH603222, stock price 8.82 yuan, market value 4.631 billion yuan) announced that its wholly owned subsidiary, Ezhou Second Hospital Co., Ltd. (hereinafter “Ezhou Second Hospital”), plans to introduce a strategic investor—Hubei Changhe Military-Civilian Innovation Medical Technology Co., Ltd. (hereinafter “Changhe Military-Civilian Innovation”). Changhe Military-Civilian Innovation intends to invest 183 million yuan in cash to increase its stake in Ezhou Second Hospital, reaching a 40% ownership after the capital increase.

Jimin Health will waive its pre-emptive subscription rights. After the capital increase, it will still hold 60% of Ezhou Second Hospital, which will change from a wholly owned subsidiary to a controlling subsidiary. Since this transaction constitutes a related-party transaction, it still requires approval from the company’s shareholders’ meeting.

Image source: Jimin Health Announcement

According to the disclosed transaction details, Changhe Military-Civilian Innovation plans to invest 183 million yuan in cash at a pre-investment valuation of 274 million yuan.

The valuation of all equity interests in Ezhou Second Hospital has increased by 30.3694 million yuan over its book value, a 12.47% increase, mainly due to the higher valuation of intangible assets (land use rights) compared to their book value.

Regarding the change in ownership structure, after the capital increase, Changhe Military-Civilian Innovation will hold 40% of Ezhou Second Hospital, and Jimin Health will hold 60%. Jimin Health explicitly states that it waives its pre-emptive rights for this capital increase but emphasizes that Ezhou Second Hospital will remain a controlling subsidiary, and the scope of consolidated financial statements will stay unchanged.

The announcement specifically notes that this transaction is a related-party transaction. Jimin Health owns 40.54% of Hubei Changhe Intelligent Technology Venture Partnership (Limited Partnership) (hereinafter “Changhe Intelligent Technology”), which in turn owns 40% of Changhe Military-Civilian Innovation.

This related-party structure provides natural advantages in business synergy and resource integration but also requires greater transparency and regulation during the transaction process.

In the first half of 2025, outpatient volume at Ezhou Second Hospital increased by 12.99% year-over-year, and inpatient discharges increased by 5.64%. The company’s revenue during the same period grew by 4.25%, but net profit was -8.1088 million yuan, and operating profit was -10.3753 million yuan. In the first three quarters of 2025, net profit loss widened to -13.2359 million yuan.

For the loss-making Ezhou Second Hospital, this capital injection will provide valuable financial support.

For Jimin Health shareholders, although waiving pre-emptive rights reduced ownership from 100% to 60%, the introduction of external capital allowed for asset revaluation while maintaining control, balancing short-term interests with long-term development.

What about the strategic investor? Changhe Military-Civilian Innovation was established at the end of September 2025. Its main businesses include: technical services, development, consulting, communication, transfer, and promotion; medical research and experimental development; new material technology R&D; and enterprise management.

By the end of 2025, Changhe Military-Civilian Innovation’s total liabilities were very low at only 87,500 yuan, while total assets reached 448 million yuan. Notably, the company had no revenue in 2025, with a net loss of 2.3522 million yuan.

As of the announcement date, Ezhou Second Hospital had received an initial investment payment of 18.2606 million yuan from Changhe Military-Civilian Innovation, demonstrating the investor’s sincerity and significant progress in the transaction. However, the announcement also highlights risks: if the involved parties fail to fulfill their rights and obligations as agreed, the transaction could face delays or even fail to complete smoothly, so there remains some uncertainty.

Disclaimer: The content and data in this article are for reference only and do not constitute investment advice. Please verify before acting. Use at your own risk.

Cover image source: Meiri Media Library

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