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 last traded at 16 cents before trading of its shares was halted on May 13.

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 874.3 million baht (S$34.4 million) in 2024, an increase of 23.6 per cent over the previous year. Its net profit rose 41.4 per cent over the same period to 338.7 million baht.

The group is founded and headed by Dr Veerapol Khemarangsan, an obstetrics and gynaecology specialist who is also personally involved in stem cell procedures.

Among Cordlife’s other substantial shareholders are China’s Nanjing Xinjiekou Department Store and TransGlobal Real Estate Group.

UOB Kay Hian analyst John Cheong said shareholders should consider accepting Medeze’s offer, which is priced at an attractive premium to the current share price, and “switch into other better companies”.

Maybank Securities’ Jarick Seet said that the offer opens up an opportunity for shareholders to sell some of their shares at a price much higher than what the market is offering.

“I think it’s the best option the shareholders have now if they are looking for some liquidity,” he said.

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 9½-month suspension of Cordlife’s operations from December 2023 to mid-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 more than 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 it has increased the number of laboratory and technical staff, strengthened operational protocols and established a medical and technical advisory board to provide guidance on best practices.