Nissha Co. Ltd. plans to fully divest its controlling stake in Vietnamese medical device maker USM Healthcare Medical Devices Factory JSC, less than four months after acquiring the company, following the discovery of accounting irregularities related to circular transactions before the acquisition.
The board of Nissha, a Japanese industrial and materials group, approved the sale on September 4, 2026, under which the group will transfer all 16.96 million USM shares, or a 60% stake, to Vo Xuan Boi Lam, director and general director of USM who holds the remaining 40%.
The transaction price was not disclosed because of contractual confidentiality obligations.
Nissha acquired its controlling stake in USM on May 20, 2026, as part of a strategy to strengthen the Vietnamese company’s existing operations and expand its medical device contract development and manufacturing organization (CDMO) business in Southeast Asia. However, problems emerged during post-acquisition integration and preparations for consolidating USM’s financial results.
On August 4, Nissha said it had postponed the release of its second-quarter financial results and was considering an extension for filing its semi-annual securities report. The company subsequently identified inappropriate accounting treatments centered on circular transactions conducted at USM prior to the transaction.
Nissha launched an investigation with external experts to ascertain the facts. It said the accounting misconduct was initiated by USM officers and employees before the takeover and that Nissha had no involvement.
After assessing whether the expected benefits of the acquisition could still be realized, Nissha concluded that maintaining and increasing corporate value was no longer feasible and decided to withdraw completely.
Under the agreement signed on September 4, Nissha will sell its 59.99% stake, while its consolidated subsidiary Nissha Vietnam Co. Ltd. will transfer the remaining 0.01%. The first tranche, representing 50% of USM’s shares, is scheduled to be transferred in mid-September 2026. The remaining 10% will be handed over between mid-September 2027 and mid-September 2028.
In addition to equity holdings, Nissha noted that its business relationship with USM includes outstanding corporate loans provided to the subsidiary.
Founded in October 2012, USM Healthcare manufactures and sells medical devices from its facility in Ho Chi Minh City’s Saigon Hi-Tech Park. The company has registered capital of VND282.68 billion ($10.9 million).
Nissha expects to recognize a gain or loss from the disposal of its investment in the affiliate in both its standalone and consolidated financial statements for the fiscal year ending December 31, 2026.
The company said its management is still assessing the precise financial impact of the divestment and any potential revisions to its full-year consolidated earnings forecast. The company also confirmed that it will disclose the impact and any changes to its earnings outlook once the assessment is complete.
