Dietary supplement company Promisia Integrative plans to raise $1.3 million in a rights issue at a 40% discount for working capital.
Under the offer, the Wellington-based company's shareholders can apply for one new share for every 10 existing shares as at 5pm on November 25 at 3c a share. The stock last traded at 5c and has soared 233% this year.
Promisia's Arthrem dietary supplement for sore joints is based on an extract from the plant Artemisia annua. More working capital will allow the company to grow a larger crop, ramp up extraction and maintain higher levels of raw materials and finished stock, it says.
The rights issue includes an oversubscription facility.
This month Promisia said sales in the first 10 months of the year were $2.2 million and October sales topped $300,000, mainly from New Zealand. At the current monthly rate of sales, the company "achieves breakeven or close to breakeven trading," it says.
Promisia is also developing a canine version of its product, which it hopes to launch in the second quarter of 2017.
The proprietary extract made from the medicine herb Artemisia annua was originally tested as a malaria treatment in Papua New Guinea. It is grown for Promisia on a farm in Tanzania.
The shell of what is now Promisia first listed in 1983 as Genestock New Zealand, before becoming first Parapine Timber, then Counterpoint Equities and Savoy Equities, before hiring a brand specialist and rebranding as Promisia in December 2013. At its most recent price, the company has a market value of $23.9 million.
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