Friday, July 1

COVID testing firm Prenetics shares fall in New York debut

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HONG KONG — Hong Kong-based COVID-19 testing firm Prenetics Ltd’s shares fell 4.4% to $7.45 in their Nasdaq debut on Wednesday, following its merger with a US-listed blank-check firm.

Prenetics announced a merger in September with Artisan Acquisition Corp, backed by Hong Kong tycoon Adrian Cheng, that gave the testing firm a $1.25 billion enterprise value.

The company’s Nasdaq debut took longer than expected after Prenetics had initially hoped to start trading by the end of 2021 or the first quarter of 2022.

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Prenetics plans to use some of the $170 million in proceeds from the merger for corporate activity, according to chief executive Danny Yeung, who added telehealth would be a key sector for potential expansion.

“We’re talking to multiple targets from an M&A perspective… we want to acquire companies that fit into our umbrella of healthcare,” Yeung told Reuters.

Prenetics is a major provider of PCR testing in Hong Kong where Yeung estimates the firm carries out 10,000 to 15,000 tests a day.

It also sold 13 million rapid antigen tests in the first quarter of the year in the city, he added.

Hong Kong maintains some of the strictest COVID rules in the world, second only to China.

All airport arrivals are tested before and after getting on the plane and compulsory notices on residential buildings are still common.

Prenetics also has contracts for testing for the English Premier League soccer matches and cruise liners in the UK and Europe.

The firm has estimated nearly 75% of its current revenue is sourced from COVID-related business but forecasts that will decline to 20% by next year.

It plans to replace that COVID-related revenue with two new products, colorectal screening tests and at-home blood tests, due to be launched shortly.

(Reporting by Scott Murdoch in Hong Kong and Niket Nishant in Bengaluru; Editing by Sriraj Kalluvila and Krishna Chandra Eluri)