SINGAPORE (THE BUSINESS TIMES) - Catalist-listed medtech firm QT Vascular has dropped a proposed reverse takeover (RTO) involving a Mongolian mining and energy company, as the deal's conditions precedent were not met by the deadline.

In August, the balloon catheter specialist said it planned to acquire the entire interest in Tengri Coal and Energy (TCE) for $1 billion in cash and new shares.

QT Vascular announced on Sunday night (Nov 22) that the conditional sale and purchase agreement (SPA) signed with the seller had ceased.

This was because two conditions precedent were not fulfilled or waived as at Nov 21: The compliance placement was supposed to have been finalised while the parties were to obtain the Singapore Exchange's approval, both within three months from the SPA's date.

If completed, the deal would have resulted in an RTO of QT Vascular, with the medtech firm's existing assets and liabilities disposed of so that it would become a shell company into which TCE could be injected.

QT Vascular's board had said in August that the RTO would give the company "a new lease of life" and potentially increase its market capitalisation.

Singapore-incorporated TCE's operating entities are Tengri Petrochemicals, which holds mining licences issued to mine coal deposits in Mongolia, as well as Tsaidam Energy, which holds licences to construct power plants and energy facilities in the country.

Investors reacted to the latest announcement with a heavy selloff of QT Vascular's shares on Monday morning.

The stock lost 0.3 cent or 33.3 per cent to trade at 0.6 cent after 163.2 million shares changed hands, as at 10.01am. It was the fourth-most actively traded by volume on the Singapore bourse at the time.