Indonesia-listed laboratory chain PT Diagnos Laboratorium Utama (Diagnos) plans to acquire a 97% stake, worth $24 million, in the DNA testing platform ASA Ren through a rights issue, according to a disclosure published on the Indonesia Stock Exchange (IDX) on Wednesday.
Diagnos plans to issue 921 million new shares at 505 rupiah apiece in the 465 billion rupiah rights issue. The company will use 357 billion rupiah ($24 million) to acquire Asa Ren and the rest for working capital needs.
The acquisition will happen in two stages. First, Diagnos will undertake an ‘inbreng’ (non-cash transaction) with PT Bundamedik and PT Bunda Investama Indonesia (BII) who will buy an 88.17% stake in Asa Ren for $21.7 million. Bundamedik and Bunda Investama are shareholders of Diagnos who will take part in the rights issue.
In the second step, Diagnos will acquire a 9.18% stake in Asa Ren for $2.41 million.
The rights issue will change Diagnos’ shareholding pattern. Bundamedik’s stake will be reduced to 26.17% from 41%. BII’s ownership will fall to 28.7% from 38.8%. The rest will be owned by institutional investors such as SBI Kejora Orbit Fund, Northstar, Malaysia’s Orbit Capital, and INA director Stefanus Ade Hadiwidjaja, and the public.
Founded by Aloysius Liang in 2016, Asa Ren is a DNA data company. The company has an office and lab in Jakarta and an IT centre in Bandung, West Java.
According to BDO LLP, a London-based business advisory firm, Singapore-registered Asa Ren booked annual losses of S$2.8 million in 2023, compared with S$1.9 million in 2022. Revenues jumped from S$215,000 in 2022 to S$429,000 in 2023.
Asa Ren is tapping into a multi-billion-dollar market. According to a report by Report Ocean in January, the genetic testing market globally is expected to reach $21 billion by 2027—a CAGR of 10.1% from 2020 to 2027.
Founded in 2007, Diagnos supports businesses such as pharmaceutical warehouses, eye banks, sperm banks, and blood banks besides its health laboratory business.
Diagnos recorded losses of 13.65 billion rupiah in 2023, compared with a profit of 12.66 billion rupiah in 2022. Its net income fell 24.46% to 145.7 billion rupiah from 192.88 billion rupiah in 2022.