KUALA LUMPUR (July 22): Khazanah Nasional Bhd’s venture capital arm Xeraya Capital Sdn Bhd investee Rapid Micro Biosystems Inc has been listed on the US’ Nasdaq Global Select Market following an initial public offering (IPO) of 7.92 million shares at US$20 each to raise US$158.4 million (about RM669.76 million).
Xeraya chief executive officer (CEO) Fares Zahir, who confirmed today Rapid Micro Biosystems’ listing, told theedgemarkets.com that Xeraya initially invested in the microbiology-automation specialist in 2018.
Fares, however, declined to reveal how much money Xeraya had invested in Rapid Micro Biosystems so far.
"We co-led the B-round [funding] with Bain Capital Life Sciences when we first invested in Rapid Micro [Biosystems] in March 2018 and brought in good investors then (Asahi, TVM Capital Life Science, etc) as well as in subsequent C and D rounds (Ally Bridge Group, BlackRock Inc and T. Rowe Price, among other notables).
"Automation and precision in the QA (quality assurance) processes of pharmaceuticals and biotechs are going to become very important, especially in light of the [Covid-19] pandemic,” he said.
In start-up funding terminology, seed, Series A, B, C and D funding rounds are synonymous with the different progress levels of newly-established businesses prior to their IPOs.
Upon completion of the seed funding and Series A funding rounds, the companies, which have grown past the development stage and established customer bases for their products, will move on to the subsequent funding rounds, during which anchor investors will bring in more financing for these companies from other investors.
According to Rapid Micro Biosystems' statement, prospectus and US Securities and Exchange Commission (SEC) filings, Rapid Micro Biosystems' IPO involved 7.92 million shares of Class A common stock in the company.
Rapid Micro Biosystems’ share trade, which began last Thursday (July 15), closed at US$21.13 yesterday (July 21).
The company said in its prospectus: "This is an IPO of shares of Class A common stock by Rapid Micro Biosystems. Prior to this offering, there was no public market for our shares of Class A common stock. The IPO price is US$20 per share. Our Class A common stock has been approved for listing on the Nasdaq Global Select Market under the symbol 'RPID'.
"Following this offering, we will have two classes of common stock: Class A common stock and Class B common stock. The rights of the holders of Class A common stock and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock will be entitled to one vote and shares of Class B common stock will be non-voting, except as may be required by law.
"Each share of Class B common stock may be converted at any time into one share of Class A common stock at the option of its holder, subject to the ownership limitations provided for in our restated certificate of incorporation to become effective upon the closing of this offering,” Rapid Micro Biosystems said.
According to Rapid Micro Biosystems' prospectus, Xeraya via Colony Harvest Ltd owned 2.98 million Class A shares representing 11.83% of Rapid Micro Biosystems’ 25.17 million Class A shares prior to the IPO.
After the IPO, Colony Harvest’s stake of 2.98 million Class A shares in Rapid Micro Biosystems stood at 9%, according to the prospectus.
According to the prospectus, Colony Harvest does not own any Class B shares in Rapid Micro Biosystems.
In Rapid Micro Biosystems’ statement dated July 14, 2021, the company said the IPO was expected to close on Monday (July 19, 2021), subject to satisfaction of customary closing conditions.
JP Morgan Securities LLC, Morgan Stanley & Co LLC, Cowen and Company LLC, and Stifel, Nicolaus & Company Inc were the joint book-running managers of the offering, according to Rapid Micro Biosystems.
Meanwhile, Xeraya’s website indicates that Xeraya is the “brainchild" of Khazanah, which is Malaysia’s sovereign wealth fund.
“Today, we are a strong team of investment and business experts with decades of experience in life sciences, managing a broad portfolio of direct and indirect investments while actively pursuing and evaluating new opportunities,” Xeraya said.