Ann: Change in substantial holding, page-4

This is big ! Xianhui (Steven) Meng has just bought another 5m shares increasing his interest in the company to 13%. Very interesting indeed and should be hugely respected.

I'll revert to an earlier post when he first came on the register (SP was 15c) to shed some light on this guy and what he means for the business.

Who is Mr Steven Meng or Meng Xianhui ??

He is powerhouse in the China Pharma space. After some digging I found he is former executive director and now active deputy general manager of sales and marketing, and 7th largest equity holder, in Sihuan Pharma Holdings.

Before that he was the department head of a state owned enterprise for 10years so would have some valuable contacts high up. Source Bloomberg.

So he certainly has the reputation to match the bullish announcement. Very promising and yet to register on people's radar as they focus on the Christmas ham instead. His reach into china dist channels / Hospitals and government contacts given his positions at Sihuan has me calling this an inflection point in the company.

What can he do for the company ?

Like a few other posters have said ... I expect Meng to join to board early in 2018. You don’t take a 13% strategic holding in a company to sit on the sidelines. Perhaps another hint was this line of the recent announcement “Mr Meng will bring both his international corporate and management skills to Uscom”. So assuming that’s the case he will be our key man on the ground in China. Tick!

If all reports stack up its huge. His SOE govt relation positions and Sihuan, sales and marketing, relationships open up 3,000 distributors who sell into 10,000 hospitals in China. There are a total of 29,140 hospitals in China and this number grows each year. The scope is huge if Mr Meng can get this channel moving.

My view is they begin ramping the USCOM 1A sales into these channels quickly to setup established relationships for when BP+ and Spiro get approved. From research an USCOM 1A costs around 13,000 USD gross. I am being conservative here and just assuming the target market is just hospitals, not GPs, home care facilitators, digital health care providers.

Now lets discount Mengs hospital reach by 80% = 2,000 potential hospital, assume they each purchase just one device, unlikely given how big these hospitals are, but sensible when trying to comprise the value of the relationship with Meng.

2000 hopsitals x 13,000 USD p.u = 26,000,000 USD / 0.7780AUD = 33.4m AUD gross revenue.

This is one device, one country, and I consider a conservative approach. Assuming not a single device gets sold in the US, Europe or Australia they are still very impressive revenue numbers for a micro cap company.

2018 is shaping up to be an absolute cracker and at the moment we are flying under the radar. But for how much longer.

Best of luck !