Cordlife gets offer from Thailand's largest stem cell bank Medeze Group for 10% stake in company
Cordlife gets offer from Thailand's largest stem cell bank Medeze Group for 10% stake in company
SINGAPORE - Thailand-listed Medeze Group is making a move to acquire a 10 per cent stake in Singapore-listed cord blood bank Cordlife Group.
The offer, which will be done through Medeze's wholly-owned subsidiary Medeze Treasury, will comprise 25.63 million shares at 25 cents each in cash.
This represents a 61.3 per cent premium over Cordlife's last traded price of 15.5 cents on May 9, Cordlife said in a May 13 statement filed on the Singapore Exchange. The offer price also exceeds the 12-month average price of the stock.
Cordlife shares were unchanged at 15.5 cents at 9.15am on May 13, after the announcement.
If successful, the partial offer will raise Medeze's direct stake in Cordlife to about 10.68 per cent.
It will also mark Medeze's first strategic move to expand in the Singapore market.
In its statement, Medeze, which is among South-east Asia's largest stem cell storage and services providers, said it intends to engage with Cordlife as a substantial shareholder to explore long-term business opportunities that could deliver long-term value for both parties.
For instance, Medeze would be able to offer natural killer cell analysis and hair follicle banking to Cordlife clients, while Cordlife could provide genetic and chromosomal screening services to Medeze's customers.
Medeze, which listed on the Stock Exchange of Thailand in October 2024, recorded total revenue of THB 874.3 million in 2024, up 23.6 per cent over the previous year. Its net profit rose 41.4 per cent over the same period to THB 338.7 million.
The group was founded and is headed by Dr Veerapol Khemarangsan, an obstetrics and gynecology specialist who is also personally involved in stem cell procedures.
Cordlife has currently two substantial shareholders, China's Nanjing Xinjiekou Department Store and TransGlobal Real Estate Group.
The partial offer from Medeze comes after Cordlife's cord-blood banking service and human-tissue banking service licences were renewed by the Ministry of Health (MOH) for a year from Jan 14 .
MOH said that its audits showed that Cordlife has satisfactorily addressed critical shortcomings in various areas, including temperature monitoring practices, cord-blood inventory management, and incident response.
This followed a nine-month suspension of Cordlife's operations from December 2003 to September 2024, due to lapses in the storage of its cord-blood units that damaged the cord blood units belonging to at least 2,150 clients and rendering them unsuitable for stem cell transplant purposes.
Cordlife was later permitted to resume operations in a controlled and restricted manner from Sept 15, 2024, to Jan 13, before its licences were renewed on Jan 14.
In 2024, Cordlife posted a net loss of $18.7 million, compared with a net profit of $3.6 million a year earlier.
Revenue declined 50 per cent to $27.8 million from $55.7 million a year ago, mainly due to almost nine months of suspension of the group's operations in Singapore.
In its 2024 results announcement, the company also said that it has made 'significant upgrades' to its processing and storage facility in Singapore, including implementing an enhanced laboratory monitoring system to provide round-the-clock real-time on-site and remote monitoring of key equipment.
Cordlife also said that it has also increased the number of laboratory and technical personnel, strengthened operational protocols and established a medical and technical advisory board to provide guidance on best practices.
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