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G Medical Innovations shares ride higher after signing US$405M deal

The company's mobile case transforms a smartphone into a medical monitoring device.
Prizma Medical Smartphone Case
Medical data can be stored in the cloud

G Medical Innovations Holdings Ltd (ASX:GMV) has executed a binding memorandum of understanding for the distribution of its Prizma Medical Smartphone Case in India and Taiwan.

The company’s shares were last trading circa 33% higher intra-day, at $0.52.

The Israeli mobile health outfit’s key product, Prizma, is a consumer device that transforms any smartphone into a medical monitoring device.

Prizma allows users to store their medical data in the cloud and share it with third parties including professionals and family.

G Medical has signed a distribution agreement with First Channel Ltd, valued at $US405 million for 3 years on minimum commitments, broken down as:

- Year 1 – US$90 million;
- year 2 – US$135 million; and
- year 3 – US$180 million.

FCL is in late stage discussions with their Tier 1 partners, including Vodafone India, Reliance Communications and BSNL Mobile.

It is anticipated that these third-party agreements will be finalised shortly, hence providing additional support for the distribution and financial commitments outlined in the agreement.

However, the tier 1 partners of FCL have not yet formalised a definitive arrangement with FCL, and thus FCL has not yet established its ‘Letter of Credit’ from a first class bank.

On this basis, it cannot be categorically stated that the full anticipated revenues under the agreement with FCL can be achieved, until such time a definitive arrangement has been formalised.

G Medical started trading on the ASX in May 2017, following a $12 million initial public offer.

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