LYC Healthcare to acquire 70% stake in Clinical Nutrition to expand nutraceutical segment

KUALA LUMPUR (Nov 8): LYC Healthcare Bhd has proposed to acquire a 70% stake in Clinical Nutrition Intl (M) Sdn Bhd, which is mainly involved in the supply of nutraceutical ingredients, for RM2.24 million cash.

In a filing with Bursa Malaysia on Tuesday (Nov 8), the group said it will streamline the interests in all its nutraceutical companies under LYC Nutrihealth Sdn Bhd (LYCN), a wholly owned subsidiary of LYC Medicare Singapore Pte Ltd.

LYCN will also enter into a put option agreement with the vendors of Clinical Nutrition for the remaining 30% shareholding which shall be exercised from Sept 28, 2024 and shall expire by Sept 27, 2027.

According to LYC Healthcare, the addition of Clinical Nutrition will support the growth of the group's nutraceutical businesses, which are mainly driven by Aqurate Ingredients Intl (M) Sdn Bhd and Microbiome Intl (M) Sdn Bhd.

LYC Healthcare managing director cum group chief executive officer David Sui Diong Hoe said it is timely for the group to enhance its market presence in this growing market by developing more products.

Clinical Nutrition owns the 50% shareholding in two proprietary probiotic strains, namely Lactobacillus Plantarum DR7 and Lactobacillus Fermentum DR9, with DR7 having already been successfully commercialised and patented. It is also involved in formulation and sale of "Sweden Farm Instant Oat Drink", an eight-year-old brand, to reduce cholesterol and lower the rise of blood glucose, which is sold in selected pharmacies and online channels in Malaysia.

"Clinical Nutrition has two valuable ownership of probiotic strains that have demonstrated to successfully benefit overall health," he said.

"Looking ahead, there are ample opportunities for us to monetise these strains by leveraging on Aqurate's strong sales network and working together with foreign parties for international distribution," he added.

The proposed acquisition is expected to be completed within three months.

At the closing bell on Tuesday, LYC Healthcare shares slipped half a sen or 2.63% to 18.5 sen, with a market capitalisation of RM106.99 million.