Bioalpha, North West ink MoU on stake purchase

KUALA LUMPUR: Bioalpha Holdings Bhd has entered into a memorandum of understanding (MoU) with North West Enterprise Sdn Bhd to seek an opportunity to acquire a stake in the latter.

Bioalpha managing director William Hon said the proposed acquisition carried high synergistic benefits and would enable both parties to draw on each other’s capabilities to accelerate its expansion.

“Through North West, we can tap its extensive hospitality client base. This will increase our distribution network significantly and, thus, provide us with instant access to the large tourist segment,” he said in a statement.

“For example, we can improve North West’s instant beverage in sachets, such as coffee and tea, with our herbs to enhance the products — for instance, Tongkat Ali coffee or tea and Kacip Fatimah coffee or tea.

“We can also introduce natural herbal-based personal care products to be placed at the hotels supplied by North West,” Hon added.

North West is mainly involved in the manufacture, trading and supply of hotel amenities, personal care products and instant beverage in sachets to establishments in the local hospitality industry.

It has more than 30 years of strong track record.

It has exclusive distributorship arrangement with brands such as Procter & Gamble, Livi, Etro and Malin + Goetz to distribute products to clients in the hospitality industry.

Bioalpha said the acquisition of North West was likely to be funded via a proposed private placement exercise.

Bioalpha said it also planned to undertake a private placement exercise, entailing an issuance of 95.3 million new ordinary shares in the company, which represents not more than 10 per cent of its enlarged share capital.

Based on the indicative issue price of 25 sen per placement share, Bioalpha is expected to raise gross proceeds of RM20.3 million.