Hyphens Pharma Limited has acquired Ardence Pharma Sdn Bhd, a boutique pharmaceutical company specializing in aesthetic medicine and an existing associate company of Hyphens Group with 42% shareholding through Novem Sciences.
Ardence Pharma is the exclusive distributor for its flagship products PLINEST® and NEWEST® in Southeast Asia. , approved by European CE mark, signifying compliance with European standards. Ardence Pharma currently serves > 250 medical aesthetic clinics in Malaysia and Plinest has just made a successful launch in Singapore in Oct 2023.
Mr Lim See Wah, Executive Chairman and CEO of Hyphens Pharma, commented: “We are grateful to Sean for sharing our vision about the medical aesthetic business. With the proposed acquisition, Ardence Pharma will become a wholly-owned subsidiary of the Group and will help to grow our revenue and profit while strengthening our presence in Malaysia. More importantly, it will help to boost and grow our medical aesthetics business with its regional expansion plans and robust pipeline of quality clinically-proven aesthetic products. Continuing to invest and growing our medical aesthetics business will help bolster our leadership position in skin health for Southeast Asia.”
Deal Structure
The acquisition purchase includes the proposed acquisition of 58% of the issued and paid-up ordinary share capital in Ardence Pharma over 3 tranches:
- The first tranche will be 23% of the company shares (46,000) at a consideration of RM6,422,634.32 (or approx. S$1.86 million)
- The second tranche will be 17% of the company shares (34,000) based on agreed multiples; normalized EBITDA of FY2024; and a cash-free and debt-free basis
- The third tranche will be 18% of the company shares (36,000) based on agreed multiples; normalized EBITDA of FY2025 or F&2026; and a cash-free and debt-free basis (Tranche 3 can be deferred by the vendor in exercise of its rights in the event that the EBITDA for FY2025 is lower than the EBITDA for FY2024)
Reasons for Acquisition
Hyphens aims to establish a leadership position in Skin Health, and has been spearheading the
growth of their Medical Aesthetic division with brands like TDF® and Nabota®. The acquisition of Ardence Pharma will add an new range of products to the medical aesthetic business, and Hyphens expects to see accelerated growth from the synergies between both companies.
Ardence Pharma has continuously delivered strong growth over the years, with revenue of S$2.78 million and profit before tax of S$1.36 million for FY2022. The acquisition represents a strategic opportunity for Hyphens to acquire a business that is financially attractive from a revenue scale and earnings accretion perspective and with a good management team.
Through the acquisition, Hyphens will gain access to new products and customers that will enhance and enlarge the Group’s revenue and profits, and strengthen its presence in the Malaysia market.
Hyphens Pharma’s share price as of 19 October 2023 after market close was S$0.280.