Sun | Nov 18, 2018

Elite seeks $141m from junior market

Published:Wednesday | January 17, 2018 | 12:00 AM
Warren Chung, CEO of Elite Diagnostics.

Elite Diagnostics Limited is seeking $141 million of equity capital from an initial public offering that will open January 22.

The medical diagnostics company intends to use the proceeds for working capital and to pay down its debt. Elites' long-term loans doubled last year to $114 million.

The junior market IPO will offer 70.68 million shares at $2 each, 18 million or 25 per cent of which are reserved.

Among the current owners of Elite, a successful IPO would result in Excel Investments holding 41 per cent of the company, followed by NCB Capital Markets with 23.7 per cent, Sagicor Investments at 7.9 per cent, and Barnett Limited at 6.3 per cent.

The listing would grow the shareholding from 282.7 million units to 353.4 million units, and the general public would end up with 52.68 million shares or 14.9 per cent of the company.

Excel Investments is the vehicle held by founding partners Warren Chung and Dr Neil Fong.

Elite commenced operations in August 2013 at Holborn Road, New Kingston, with backing from NCB Capital Markets, Sagicor Investments and Barnett Limited. The company added a new branch at Old Hope Road last November.

Elite will list at a market multiple of roughly 13 times its historic earnings.

In its first full year of operation ending June 2014, Elite made a loss of $47 million on revenue $58 million. The following year ended in the black, with a small profit of $500,000 while revenue increased by approximately 127 per cent. Its growth trajectory has been maintained since, with revenues coming in at $263 million and profit at $44 million for year ending June 2017.

The IPO is co-arranged by NCB Capital and Sagicor Investments.


CORRECTION: This story has been updated to clarify that the general public will end up owning 14.9 per cent of Elite under a successful IPO. It is not the proportion of shares available to them in the IPO, as first reported.