SINGAPORE (Oct 16): Asian Healthcare Specialists (AHS) is proposing to issue $5 million in convertible bonds due in 2021 to Vanda 1 Investments at the conversion price of 25 cents per conversion share.

The issuance comes with a grant of an option for the investor to subscribe for another $5 million worth of shares at the price of 32.5 cents per option share.

The conversion and option prices represent a respective 0.2% and 30.3% premium over AHS’s volume weighted average price for trades done on 12 Oct at 24.95 cents.

Vanda 1 Investments is controlled by Heliconia Capital management, an independently managed subsidiary of Temasek Holdings.

Should the option be fully exercised, AHS is expecting up to $9.92 million in net proceeds which it intends to fully use for its business expansion and growth plans.

In its filing to the SGX on Monday evening, AHS notes Heliconia has invested in leading Singapore enterprises through the various funds that it manages.

With Heliconia on board as a strategic investor, the group hopes to leverage its value creation resources and strategic networks to facilitate its own growth in the Asean region, where AHS aims to tap into a growing demand for healthcare, particularly in the specialist areas of musculoskeletal care & services, as part of its growth strategy.

“This partnership reflects [our] strategy to build value-added relationships that will help chart sustainable growth in a fast-growing sector and enhance shareholders’ value, as the group continues to provide its expertise to the people that it is privileged to serve,” says Chin Pak Lin, CEO of AHS.

“With support from Heliconia and the group’s strengthened financial position, the group is well-positioned to cater to the increasing demand for musculoskeletal care and services locally, and in time to come, regionally,” he adds.

The full issuance of both conversion and option shares is estimated to bring AHS’s net asset value (NAV) per share to 6.32 cents compared to its current NAV per share of 3.64 cents.

On a pro-forma basis for illustration purposes, earnings per share (EPS) for FY17 would have been 0.13 cent instead of 0.15 cent as a result of the share base dilution.  

Shares in AHC closed flat at 24 cents on Monday.