Sedania Innovator joins health tech

The proposed deal is in line with the group’s strategies to mitigate the risks of relying on current ongoing businesses

by NUR HANANI AZMAN / pic credit: offspringinc.com

SEDANIA Innovator Bhd has proposed to buy a 51% stake in Offspring Inc Sdn Bhd from Sedania Corp Sdn Bhd for RM15.12 million cash as part of a diversification move into consumer products specialising in healthcare, personal care, household, and baby and childcare.

Sedania Corp is owned by Sedania Innovator MD and founder Datuk Noor Azrin Mohd Noor.

The related-party deal will also see Sedania Innovator move into health technologies specialising in preventive healthcare technology solutions.

Sedania Innovator, in its filing yesterday, stated that the proposed deal is in line with the group’s strategies to diversify its income streams into other businesses with promising growth prospects to supplement its existing businesses and to mitigate the risks of relying on current ongoing businesses.

“The proposal will enable the group to venture into the health technology industry supported by Offspring’s current business activities in product development, marketing and sales of a range of preventive healthcare products, and brand presence in the preventive healthcare products market,” it said in a Bursa filing yesterday.

Sedania Innovator intends to collaborate with Offspring to build and develop preventive digital healthcare technology solutions.

With Sedania Innovator’s track record in providing user-driven solutions to enterprises in the telecommunications and financial industries, the proposed acquisition would serve as a launching pad for the two parties to penetrate the preventive healthcare technology industry.

Sedania Innovator noted that the future of healthcare will include technology that seamlessly combines data on a patient’s medical history, real-time health, insurance coverage and financial information to support decision-making, improve patients’ wellbeing and reduce the cost of healthcare.

Sedania Innovator sees this space as a market opportunity, and believes will add value to its existing business activities and position the group as a health technology player, while realising its synergies in the preventive healthcare sector.

The proposed acquisition comes with the profit guarantee of at least RM3.8 million on an accumulated basis to the group for two consecutive financial years — financial year 2020 (FY20) and FY21. The achievement of the aforesaid profit guarantee by Offspring is expected to improve the consolidated profit of Sedania Innovator throughout the profit guarantee period, its filing stated.

Offspring has expanded its distribution channels to third-party e-commerce platforms, namely Shopee, GrabMart and Vettons.

Offspring is principally involved in the product development, marketing and sales of a range of natural and organic preventive healthcare products such as hand sanitisers and sanitising wipes, baby and childcare products, as well as household products in Malaysia and exports to Singapore, the US and Russia.

Sedania Innovator’s shares closed 6.25% or one sen lower at 15 sen yesterday, valuing the company at RM45.33 million.