How the Operator of a Handful of Asian IVF Clinics Wound up on Nasdaq
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BY RON SHINKMAN
A small chain of IVF clinics in Asia has gone public, with its stock listed on the Nasdaq exchange.
NewGen IVF Group operates single clinics in Hong Kong, Thailand, Cambodia and Kyrgyzstan. Its stock began trading on April 4, according to a statement issued by the company.
NewGen IVF was founded a decade ago, according to a video posted in 2019 by Alfred Siu, founder of its parent company, First Fertility Group. Siu said in the video that the clinic in Cambodia was conducting about 700 IVF cycles per year.
How did a company as small as NewGen IVF go public? It relied on a fairly new path for making an initial public offering: A blank check company or special purpose acquisition company, also known as a SPAC.
A SPAC is essentially a shell company that raises money from outside investors and issues stock. It then acquires a privately-held company that becomes the face of the organization as it is listed on a stock market such as Nasdaq. The best known SPAC transaction took Donald Trump’s Truth Social platform public, which combined the Digital World Acquisition Corp. SPAC with Trump Media & Technology Group.
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However, Goodman also noted that the company was not sizable and its stock offering wasn’t much different from so-called “penny stocks” or “pink sheet” stocks – shares issued by companies so minuscule they often can’t meet the requirements for trading on traditional stock exchanges.
To date, the market expressed extreme skepticism to the NewGen IVF stock. It was initially priced at $10 per share but dropped to around $3 per share on its first regular trading day on Nasdaq. The stock was trading at $1.22 per share midday on April 16. It had fallen below $1 a share, but was bolstered in late April by the announcement of a pending reverse merger with a company called European Wellness Investment Holdings Limited. That briefly pushed the NewGen IVF price above $2 a share, but it has since dropped.
“This may be an easier way to get to the IPO market for some companies, but you still have to be deserving (to remain there),” Goodman said of NewGen IVF Group’s approach. “You still have to have the fundamentals of a good management team and a good strategy to make the business work.”
In this case, the Bangkok-based NewGen IVF Ltd. was acquired by A SPAC I Acquisition Corp., which is based in the British Virgin Islands, according to a filing with the Securities and Exchange Commission. The merged companies then renamed itself NewGen IVF Group. Its stock trades on Nasdaq’s Capital Market, a tier of the exchange for newer and smaller companies whose rules are more relaxed than the Nasdaq Global Select Market and the Nasdaq Global Market, which are venues for larger and more established companies.
“We believe our public listing will help us to accelerate our growth and execute on our long-term vision,” Siu said in a statement announcing the merger, although no further details were provided. A spokesperson for NewGen IVF Group in New York City did not respond to a request seeking comment.
SPACs are a relatively rare vehicle for taking a company public, and this appears to be the first instance of a reproductive medicine company to take that route, according to Robert Goodman, vice president of healthcare for MidCap Advisors, a New York firm that assists in transactions among mid-sized companies.
“I think (Siu) saw value in the SPAC concept,” Goodman said, adding that the NewGen IVF founder was educated in the U.S. and is likely familiar with such an esoteric transaction.
The content and themes expressed within the article are that of the news. The advertiser does not have editorial control over the content of this article, and Inside Reproductive Health maintains full editorial independence. The views and opinions expressed in this article do not represent the views of the Advertiser or of Inside Reproductive Health.
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