China’s Dehaier Medical Systems (NSDQ:DHRM) said today that it plans to ditch its unprofitable medical device businesses so it can focus on its wearable sleep respiratory business.
Dehaier said it plans to form a new subsidiary called Connection Wearable Health Technology by the end of this month, aiming to focus on “wearable sleep respiratory and mobile health related businesses.”
The plan also calls for Beijing-based Dehaier to bail out of the assembly and sale of X-ray and anesthesia machines, but will retain its medical air compressor and CPR instruments businesses. The remaining Beijing Dehaier Medical Technology operation will also look to collect on accounts receivable and sell off inventoryas it winds down the unprofitable segments.
“We believe these changes are crucial to improve our competitiveness over the longer term. By restructuring our company to reduce our reliance on our less profitable medical devices assembly and distribution businesses, we will be more able to leverage our resources to develop smart health products and services, which we see as the future of our company. Our long-term goal is to gradually decrease our production business, and focus instead on developing a complete mobile health operation platform as well as a supply chain management platform by utilizing the products produced by 3rd parties,” CEO Ping Chen said in prepared remarks.
Late last year Dehaier said it was considering a $20 million equity investment offer from Hangzhou Liaison Interactive Information Technology.