Duopharma cashes in on newly listed Korean investee firm, secures RM25 mil

KUALA LUMPUR (June 18): Duopharma Biotech Bhd has secured around RM24.74 million after disposing of some 218,688 shares representing a 1.86% stake it held in SCM Lifescience Co Ltd, a biotechnology firm listed in Seoul.

The shares were sold via on-market trading on Korean Securities Dealers Automated Quotations (Kosdaq), at a total aggregated net selling price of some KRW31,980 (RM113.15) per share, the group said in a bourse filing today.

“Following this, the balance of Duopharma’s shareholding in SCM Lifescience is 328,032 shares which represent an effective equity interest of 2.8% in the latter as at to date.

“Duopharma will retain the balance SCM Lifescience shares for strategic reasons during the lock-up period which is three years from successful IPO (initial public offering) or three years from date of the SSA (Share Subscription Agreement), whichever is earlier,” it added.

Yesterday, Duopharma announced the listing of SCM Lifescience on Kosdaq at KRW17,000 (RM60.15) apiece.

The group on Oct 25, 2018, entered into an SSA with the Korean firm, Sun U Song and Byung Geon Rhee for the subscription of 164,016 common shares and 109,344 redeemable convertible preference shares (RCPS) representing approximately 5.8% equity stake in SCM Lifescience for a KRW5.5 billion (RM19.46 million) or about KRW10,060 (RM35.59) per unit.

Duopharma’s conversion of the RCPS into common shares and SCM Lifescience subsequently conducting several capital raising, bonus issue and listing exercises resulted in Duopharma holding an effective interest of 4.66%, or 546,720 shares, in SCM Lifescience.

“The sale is in line with the company’s plan to monetise the non-strategic portion of shares in SCM Lifescience. The disposal improves the company’s cash position by approximately RM25 million for the financial year ending Dec 31, 2020,” it said.

Established on July 2, 2014, SCM Lifescience specialises in the development of stem cell and immune cell therapeutics.

The company develops highly-pure stem cell therapy through patented proprietary technology for treatment of immune-related diseases and next-generation (allogeneic, non-viral use) CAR-CIK therapy and dendritic cell cancer vaccine for treatment of acute lymphocytic leukemia and advanced renal cell cancer, respectively.