This article first appeared in The Edge Financial Daily on October 2, 2018

KUALA LUMPUR: Bioalpha Holdings Bhd has proposed to raise up to RM23.83 million via a proposed private placement to third-party investors at an issue price to be determined later.

The proceeds will be partly used for launching new products such as health supplements and functional foods in the principal markets of the group or other potential new markets. It also plans to use part of the proceeds to acquire potential new businesses and for working capital.

In a filing with Bursa Malaysia yesterday, the ACE Market-listed Bioalpha said assuming an indicative price of 25 sen per share — a 1.19% discount to the five-day volume-weighted average market price of Bioalpha shares as at last Friday of 25.3 sen — the proposed private placement is expected to raise gross proceeds of between RM20.25 million and RM23.83 million.

Barring any unforeseen circumstances, Bioalpha expects the proposed exercise to be completed within six months from the date of approval from Bursa Securities.

In a separate Bursa filing, Bioalpha said it plans to acquire the business of North West Enterprise Sdn Bhd (NWESB) which is involved in the manufacture, trading and supply of hotel amenities, personal care products and instant beverage in sachets for hotels and other establishments in the hospitality industry.

Bioalpha said the proposed acquisition of NWESB will be funded via proceeds from the proposed private placement.

Its wholly-owned subsidiary Bioalpha International Sdn Bhd yesterday entered into a memorandum of understanding (MoU) with NWESB for the proposed acquisition.

The final purchase price and shareholding structure will be finalised upon the completion of due diligence on NWESB, which will not look for any other party to acquire the business during the six-month period of the MoU.

“Should the proposed acquisition materialise, the group can offer the existing clientele a new range of herbal-based natural skincare products, gentle and safe without side effects,” Bioalpha said.

“Additionally, the Bioalpha group can improve NWESB’s instant beverage in sachets such as coffee and tea, supplied to the latter’s hospitality clientele, with its herbs to enhance the products such as tongkat ali coffee or tea and kacip fatimah coffee or tea,” it added.