Premaitha Health to buy Taiwan's Yourgene Biosciences

21st Dec 2016 07:44

(ShareCast News) - Premaitha Health, a maker of non-invasive prenatal screening system, is to buy Taiwan's Yourgene Biosciences in a bid to expand the company in Asia.The acquisition of the Yourgene Biosciences, which distributes non-invasive prenatal screening systems, is subject to shareholder approval and will be paid in the issue of 76.05m shares at 9p each and $500,000 in cash.As well as its base in Taiwan, Yourgene Biosciences has a commercial hub in Singapore and generates annual sales of about £2m from across South East Asia and India. The company said that it broadly breaks-even at this level.The acquisition will become unconditional following the passing of the resolutions at the next shareholder meeting on 10 January, the London Stock Exchange agreeing to admit the shares to trade on AIM and regulatory approval required by Taiwanese law, which is expected to occur by no later than 31 January.The company said the acquisition will enable it expand in Asia, offers cross-selling opportunities and the potential to reduce intellectual property risks through geographic diversification such as to enter the Chinese market where there are about 17m births per year and a strategy to decentralise testing as part of the Chinese government's healthcare reforms.Yourgene Biosciences has a patent granted in Taiwan, a territory where there is no registration of patents equivalent to those being used by Illumina in European litigation, and it has also filed applications for this patent in China, the US and Europe.It also offers the opportunity to expand beyond non-invasive prenatal screening systems such as pre-implantation genetic screening.Dr Stephen Little, chief executive of Premaitha Health, said: "We are extremely excited about the transaction with Yourgene and their like-minded management team who have demonstrated their commitment to the enlarged group through a significant shareholding."They have successfully established a highly complementary business in South East Asia and we look forward to working together to build a truly global force in this emerging sector. The board believes that Asia Pacific will be a key region for driving sales growth, and Yourgene is an important enabler for the newly enlarged Premaitha group."The company is also seeking shareholder approval to reorganise tits share capital as the market price of its existing shares is below their value of 10p each, which prevents it issuing new shares, including the acquisition shares, as English law prohibits a company from issuing a share at a price that is less than its value.The company is proposing to divide each existing share of 10p into one share of 0.1p and one deferred share of 9.9p.Shares in Premaitha Health were down 8.33% to 8.25p at 0830 GMT.