PETALING JAYA (June 3): CCM Duopharma Biotech Bhd announced today that the issue price for its 139.48 million renounceable rights shares — to raise funds for the acquisition of six pharmaceutical units from parent company Chemical Company of Malaysia Bhd (CCM) — have been fixed at RM1.80 per share.

In a filing with Bursa Malaysia, CCM Duopharma said the issue price represents a discount of approximately 34.85% to the theoretical ex-rights price of CCM Duopharma shares of RM2.76, based on the five (5)-day volume weighted average market price of the shares up to and including June 2, 2015 of RM3.73.

It was reported that CCM Duopharma (fundamental: 3; valuation: 1.5) will buy six pharmaceutical units in Malaysia, Philippines and Singapore from CCM for RM133.3 million.

CCM Duopharma had said it would undertake a renounceable rights issue of 139.48 million new shares, to raise as much as RM195.27 million.

The company had reportedly allocated RM140 million for the acquisition and will invest the remainder RM50 million to expand the group’s pharmaceutical manufacturing operations.

CCM had said the rationalisation of the group’s pharmaceutical assets under CCM Duopharma would enable the company to bid for larger contracts from the Health Ministry.

CCM Duopharma shares closed 5 sen or 1.36% higher at RM3.74 today, for a market capitalisation of RM514.68 million.  

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations)