BF Biosciences raises Rs1.93b in IPO

Dutch auction sees 3.4x oversubscription, total demand reaching Rs4.7b

KARACHI:

BF Biosciences has successfully raised Rs1.93 billion by selling 25 million shares at Rs77 each through a two-day Dutch auction that concluded at the Pakistan Stock Exchange (PSX) on Thursday. The funds will be utilised to acquire export certificates to boost sales in Central America, Africa, and Afghanistan, increase working capital, and add new products, it was learnt.

The offering was oversubscribed by 3.4 times, with total demand reaching Rs4.7 billion during the book-building process, part of the company's Initial Public Offering (IPO). "Several brokerages issued unanimous 'subscribe' calls, leading to investor demand of Rs4.7 billion against the IPO's book-building size of Rs1.375 billion," according to a company statement.

The pharmaceutical firm started bidding at a minimum price of Rs55 per share on Wednesday. High demand from institutional and high-net-worth individual investors pushed the price to Rs77 per share, the maximum allowed increase of 40%, indicating ample liquidity in the market.

The general public will have the opportunity to subscribe to 6.25 million shares (25% of the total offer) on October 2-3 at the strike price of Rs77 per share.

Farhan Rafiq, Chief Operating Officer of BF Biosciences, vowed to ensure the growth of shareholders' equity. The company has already completed a brownfield expansion, and the IPO will help manage the working capital needed for this expansion.

Shahid Ali, CEO of Arif Habib Limited, the lead manager and book runner for the issue, expressed satisfaction with the response. "The IPO received an exceptional response, with impressive participation of Rs4.7 billion. This is a significant milestone, as it's been a long time since an IPO has garnered such overwhelming interest, achieving a 3.4x oversubscription and a 40% premium over its floor price," he said.