Israeli tech incubator Trendlines’ IPO on Singapore’s Catalist board targets $17.56m in gross proceeds

Visual from Trendlines website

Israeli business incubator Trendlines Group, specialising in medical and agricultural technology ventures, on Monday launched its initial public offer IPO) on the Catalist board, with 75.8 million shares at S$0.33 cents each, expecting to garner S$25 million ($17.56 million) in gross proceeds.

The offer price is pegged at 1.4 times the price-to-book ratio of Trendlines’ net tangible assets value as of June 30, 2015.

The IPO sponsor is PrimePartners Corporate Finance.

Incepted in 2007, Trendlines has incubated 60 portfolio firms to date.

According to TrendLines, 17 of its portfolio firms are at the “commercialisation” stage and currently generating revenue, while five have been acquired by or their assets soled to multinational corporations.

Currently, Trendlines operates through two subsidiary units; Trendline Medical and Trendline Agtech. Additionally, it also maintains an internal innovation centre, Trendline Labs.

In a statement, Trendlines stated that capital raised from the proceeds of the IPO would be used to expand Trendline Labs and invest in current and new portfolio companies. In addition, Trendlines expects to deploy S$5 million to establish new incubators, including one in Singapore by 2016.

Last year, the Canadian publication Financial Post reported that the business incubator cancelled its IPO on the Toronto Stock Exchange at the last minute, without citing any reason.

According to the Financial Post, Trendlines intended to raise C$15-C$20 million and use the net proceeds to fund both its core business activities of developing portfolio businesses, follow-on investments in portfolio firms and expansion of its laboratories beyond Israel. This was in addition to funds for working capital and general corporate purposes.

Weighing in on the IPO, Health Investor Asia noted that that funds it planned to raise were “…considerably smaller than the figures of $80 million to $100 million…” than were being announced earlier this year. It also observed that the performance of portfolio firm QT Vascular, which develops minimally invasive products to treat vascular disease, has been dismal. It opened the year at trading at S$0.315 but closed at S$0.125 on 16 November 2015.

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