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Investing.com -- Medirom Healthcare Technologies Inc. (NASDAQ:MRM) stock surged 22% in premarket trading Thursday after its subsidiary MOTHER Labs announced approval of a private placement of new shares to two company officers.
The private placement, part of MOTHER Labs’ Series A financing round, values the subsidiary at 9 billion Japanese yen (approximately $60 million). The investment will come from Yoshio Uekusa, President and CEO, and Ryo Saito, Director, with funding expected to be completed by the end of October.
MOTHER Labs, which functions as the health tech division of the MEDIROM Group, implements health guidance programs through its "Lav" healthcare app and develops wearable devices. The company stated that the capital increase aims to strengthen rapid decision-making capabilities and enhance the management structure.
The funds will be used to strengthen MOTHER Labs’ capital base, advance development of an upgraded version of its MOTHER Bracelet wearable device, and establish systems for bringing products to market.
MEDIROM indicated the investment by management is intended to heighten business responsibility and growth motivation as the company expands its operations in the healthcare and wellness sector both in Japan and internationally.
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