(Yicai) July 8 -- Shares in Improve Medical Instruments slumped today after the Chinese medical apparatus maker said that its chairman and general manager has been detained by authorities for the second time in three months and remains under investigation.

Improve Medical’s share price [SHE: 300030] closed down 6.5 percent at CNY3.56 (USD0.50) today.

The company has not been informed of the progress or conclusions of the probe that is being conducted by the Zhuhai Municipal Supervisory Commission, the Guangzhou-based company said today. The firm's other directors, senior management and supervisors are all performing their duties as usual, and the company will continue to pay attention to the situation.

Deng Guanhua was first placed in detention in April for suspected disciplinary and legal violations. The detention was lifted by the Guangdong Provincial Supervisory Commission a month later.

The company's production and operations are normal, and Deng is able to perform his duties as the company's legal representative, chairman and GM, Improve Medical said in May.

The probe might be connected with a case involving Deng’s wife, Zhang Hong, who was found guilty of insider trading in 2019. She was ordered to pay CNY37.7 million (USD5.2 million) in fines and the return of illegal gains. At the time, Deng was not implicated due to insufficient evidence.

In June 2021, Deng, who is the largest shareholder in Improve Medical, signed a share transfer agreement with a subsidiary of white goods manufacturer Zhuhai Gree Group and relinquished his voting rights. This gave the unit, which is under the State-owned Assets Supervision and Administration Commission of Zhuhai, majority voting rights in the firm.

But since then, the manufacturer of evacuated blood collection systems and other medical apparatus has logged two years of losses. Last year, Improve Medical racked up losses of CNY63.2 million (USD8.6 million) and in 2022 CNY198 million (USD27.2 million).

Deng co-founded Improve Medical in 1996 and has served as chairman and GM since October 2007. He received CNY1.2 million (USD177,000) in pre-tax compensation for his equity in the firm last year, according to the company’s 2023 annual report.

Editor: Kim Taylor