Filed by Prenetics
Global Limited
Pursuant to Rule 425
under the Securities Act of 1933,
as amended, and deemed
filed pursuant to Rule 14a-12
under the Securities
Exchange Act of 1934, as amended
Subject
Company: Artisan Acquisition Corp.
Commission File No.:
001-40411
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September 2021 Strictly Private and Confidential
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1
Disclaimer
THIS PRESENTATION AND ITS CONTENTS ARE CONFIDENTIAL AND ARE NOT FOR RELEASE, REPRODUCTION, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON OR IN OR INTO OR FROM ANY JURISDICTION WHERE
SUCH RELEASE, REPRODUCTION, PUBLICATION OR DISTRIBUTION IS UNLAWFUL. PERSONS INTO WHOSE POSSESSION THIS DOCUMENT COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, ANY SUCH RESTRICTIONS. THIS PRESENTATION IS NOT AN OFFER
OR AN INVITATION TO BUY, SELL OR SUBSCRIBE FOR SECURITIES.
About this Presentation
This Presentation has been prepared by Artisan Acquisition Corp. (“SPAC”) and Prenetics Group Limited (the “Company”) in connection with a potential business combination involving SPAC and the Company (the “Transaction”) and is preliminary in nature and solely for
information and discussion purposes and must not be relied upon for any other purpose.
The “Presentation” that follows shall mean and include the slides that follow, the oral presentation of the slides by members of SPAC or the Company or any person on their behalf, the question-and-answer session that follows that oral presentation, copies of this
document and any materials distributed at, or in connection with, that Presentation. By participating in the meeting, or by reading the Presentation slides, you will be deemed to have (i) agreed to the following limitations and notifications and made the following
undertakings and (ii) acknowledged that you understand the legal and regulatory sanctions attached to the misuse, disclosure or improper circulation of this Presentation.
This Presentation does not constitute (i) an offer or invitation for the sale or purchase of the securities, assets or business described herein or a commitment of the Company or SPAC with respect to any of the foregoing or (ii) a solicitation of a proxy, consent or authorization
with respect to any securities or in respect of the Transaction, and this Presentation shall not form the basis of any contract, commitment or investment decision and does not constitute either advice or recommendation regarding any securities. The Company and SPAC
expressly reserve the right, at any time and in any respect, to amend or terminate this process, to terminate discussions with any or all potential investors, to accept or reject any proposals and to negotiate with, or cease negotiations with, any party regarding a transaction
involving the Company and SPAC. Any offer to sell securities will be made only pursuant to a definitive subscription agreement and will be made in reliance on an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), for offers and
sales of securities that do not involve a public offering.
This Presentation does not purport to contain all information that may be required or relevant to an evaluation of the Transaction, and you will be responsible for conducting any investigations and analysis that it deems appropriate and for seeking independent advice as to
the legal, tax, accounting, financial, credit and other related advice with respect to the Transaction.
SPAC and the Company reserve the right to amend or replace this Presentation at any time but none of SPAC and the Company, their respective subsidiaries, affiliates, legal advisors, financial advisors or agents shall have any obligation to update or supplement any
content set forth in this Presentation or otherwise provide any additional information to you in connection with the Transaction should circumstances, management’s estimates or opinions change or any information provided in this Presentation become inaccurate.
The distribution of this Presentation may also be restricted by law and persons into whose possession this Presentation comes should inform themselves about and observe any such restrictions. The recipient acknowledges that it is (a) aware that the United States
securities laws prohibit any person who has material, non-public information concerning a company from purchasing or selling securities of such company or from communicating such information to any other person under circumstances in which it is reasonably
foreseeable that such person is likely to purchase or sell such securities, and (b) familiar with the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “Exchange Act”), and that the recipient will neither use,
nor cause any third party to use, this Presentation or any information contained herein in contravention of the Exchange Act, including, without limitation, Rule 10b-5 thereunder. This Presentation is not directed to any person in any jurisdiction where (by reason of that
person’s nationality, residence or otherwise) the publication or availability of this Presentation is prohibited. Persons in respect of whom such prohibitions apply must not access this Presentation. In so far as this Presentation is made available within the European
Economic Area (“EEA”) or would cause any effect in the United Kingdom, this Presentation is only addressed to and directed at persons in member states of the EEA and in the United Kingdom who are qualified investors within the meaning of Article 2(e) of the Prospectus
Regulation (Regulation EU) 2017/1129), as amended (“Qualified Investors”). In addition, in the United Kingdom, this Presentation is addressed to and directed only at, Qualified Investors who (i) are persons who have professional experience in matters relating to
investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”), (ii) are persons who are high net worth entities falling within Article 49(2)(a) to (d) of the Order, or (iii) are other persons to whom this
Presentation may otherwise lawfully be communicated (all such persons together being referred to as “Relevant Persons”). This Presentation must not be acted on or relied on (i) in the United Kingdom, by persons who are not Relevant Persons, and (ii) in any member state
of the EEA, other than the United Kingdom, by persons who are not Qualified Investors. Any investment or investment activity to which this Presentation relates is available only to relevant persons in the United Kingdom and Qualified Investors in any member state of the
EEA, other than the United Kingdom, and will be engaged in only with such persons.
Further, this Presentation should not be construed as legal, tax, investment or other advice, and should not be relied upon to form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. You should consult your own
legal, regulatory, tax, business, financial and accounting advisors to the extent you deem necessary, and must make your own investment decision and perform your own independent investigation and analysis with respect to the Transaction or any of an investment in SPAC
and the transactions contemplated in this Presentation.
Confidential Information
The information contained in this Presentation is confidential and being provided to you solely for the purpose of assisting you in familiarizing yourself with SPAC and the Company in connection with their proposed Transaction. Neither this Presentation nor any of its
contents may be disclosed or used for any purposes other than information and discussion purposes without the prior written consent of SPAC or the Company. You agree that you will not copy, reproduce or distribute this Presentation, in whole or in part, to other persons or
entities at any time without the prior written consent of SPAC or the Company. Any unauthorized distribution or reproduction of any part of this Presentation may result in a violation of the Securities Act.
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2
Disclaimer (Cont’d)
Forward-Looking Statements
This Presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Exchange Act, and also contains certain financial forecasts and projections. All statements other than statements of historical
fact contained in this Presentation, including statements as to future results of operations and financial position, planned products and services, business strategy and plans, objectives of management for future operations of the Company, market size and growth
opportunities, competitive position and technological and market trends, are forward-looking statements. Some of these forward-looking statements can be identified by the use of forward-looking words, including “anticipate,” “expect,” “suggests,” “plan,” “believe,”
“intend,” “estimates,” “targets,” “projects,” “should,” “could,” “would,” “may,” “will,” “forecast” or other similar expressions. All forward-looking statements are based upon current estimates and forecasts and reflect the views, assumptions, expectations, and opinions of
SPAC and the Company as of the date of this Presentation, and are therefore subject to a number of factors, risks and uncertainties, some of which are not currently known to us. Some of these factors include, but are not limited to: the success of the Group’s new product or
service offerings, the Company’s ability to attract new and retain existing customers, competitive pressures in the industry in which the Company and its subsidiaries (the “Group”) operates, the Group’s ability to achieve profitability despite a history of losses, the Group’s
ability to implement its growth strategies and manage its growth, the Group’s ability to meet consumer expectations, the Group’s ability to produce accurate forecasts of its operating and financial results, the Group’s internal controls, fluctuations in foreign currency
exchange rates, the Group’s ability to raise additional capital, media coverage of the Group, changes in the regulatory environments of the countries in which the Group operates, general economic conditions in the countries in which the Group operates, the Group’s ability
to attract and retain senior management and skilled employees, the success of the Group’s strategic alliances and acquisitions, changes in the Group’s relationship with its current customers, suppliers and service providers, disruptions to information technology systems
and networks, the Group’s ability to protect its brand and the Group’s reputation, the Group’s ability to protect its intellectual property, potential and future litigation that the Group may be involved in, taxes or other liabilities that may be incurred or required subsequent to,
or in connection with, the consummation of the Business Combination. The foregoing list of factors is not exhaustive. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or
otherwise, except as required by law.
In light of these factors, risks and uncertainties, any estimates, assumptions, expectations, forecasts, views or opinions set forth in this Presentation should be regarded as indicative, preliminary and for illustrative purposes only and should not be relied upon as being
necessarily indicative of future results. You should carefully consider the risks and uncertainties described in the “Risk Factors” section of this Presentation and the “Risk Factors” section of the proxy statement/prospectus on Form F-4 relating to the business combination,
which is expected to be filed with the SEC, and other documents filed from time to time with the U.S. Securities and Exchange Commission (“SEC”). These filings identify and address other important risks and uncertainties that could cause actual events and results to differ
materially from those contained in the forward-looking statements. SPAC and the Company assume no obligation and do not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.
Moreover, the Company operates in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible to predict all risks, nor assess the impact of all factors on the Company’s business or the extent to which any factor, or
combination of factors, may cause the Company’s actual results, performance or financial condition to be materially different from the expectations of future results, performance of financial condition. In addition, the analyses of SPAC and the Company contained herein
are not, and do not purport to be, appraisals of the securities, assets or business of the Company, SPAC or any other entity. There may be additional risks that neither the SPAC nor the Company presently know or that the SPAC and the Company currently believe are
immaterial that could also cause actual results to differ from those contained in the forward-looking statements. These forward-looking statements should not be relied upon as representing the Company’s and the SPAC’s assessment as of any date subsequent to the date
of this Presentation. Accordingly, undue reliance should not be placed upon the forward-looking statements.
Industry and Market Data
This Presentation also contains information, estimates and other statistical data derived from third party sources (including Frost & Sullivan). Such information involves a number of assumptions and limitations and due to the nature of the techniques and methodologies
used in market research, and Frost & Sullivan cannot guarantee the accuracy of such information. You are cautioned not to give undue weight on such estimates. Neither SPAC nor the Company has independently verified such third party information, and makes no
representation, express or implied, as to the accuracy, completeness, timeliness, reliability or availability of, such third party information. SPAC and the Company may have supplemented such information where necessary, taking into account publicly available information
about other industry participants.
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3
Disclaimer (Cont’d)
Use of Projections and Historical Financial Information
The 2019 and 2020 historical financial data included in this Presentation has been derived based on the Company’s 2019 and 2020 financial statements prepared in accordance with International Financial Reporting Standards as issued by the International Accounting
Standards Board (“IFRS”) and are subject to updates based on an ongoing external audit in accordance with the PCAOB standards. In addition, the Company’s quarterly financial data included in this Presentation is based on financial data derived from the Company’s
management accounts that have not been reviewed or audited and are subject to further review and updates.
This Presentation contains financial forecasts for the Company with respect to certain financial results for the Company’s fiscal years 2021 through 2025 for illustrative purposes. Neither SPAC’s nor the Company’s independent auditors have audited, studied, reviewed,
compiled or performed any procedures with respect to the projections for the purpose of their inclusion in this Presentation, and accordingly, they did not express an opinion or provide any other form of assurance with respect thereto for the purpose of this Presentation.
These projections are forward-looking statements and should not be relied upon as being necessarily indicative of future results. In this Presentation, certain of the above-mentioned projected information has been provided for purposes of providing comparisons with
historical data. The assumptions and estimates underlying the prospective financial information are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could cause actual results to differ
materially from those contained in the prospective financial information. While such information and projections are necessarily speculative, SPAC and the Company believe that the preparation of prospective financial information involves increasingly higher levels of
uncertainty the further out the projection extends from the date of preparation. Accordingly, there can be no assurance that the prospective results are indicative of the future performance of the Company or that actual results will not differ materially from those presented in
the prospective financial information. Inclusion of the prospective financial information in this Presentation should not be regarded as a representation by any person that the results contained in the prospective financial information will be achieved. All subsequent written
and oral forward-looking statements concerning the Company and SPAC, the proposed transactions or other matters and attributable to the Company and SPAC or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above.
Non-IFRS Financial Measures
This Presentation also includes references to non-IFRS financial measures, such as the Company’s Adjusted EBITDA for 2019 and 2020. Such non-IFRS measures should be considered only as supplemental to, and not as superior to, financial measures prepared in
accordance with IFRS. SPAC and the Company believe these non-IFRS measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of
operations. SPAC and the Company believe that the use of these non-IFRS financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends in and in comparing the Company’s financial measures with other similar
companies, many of which present similar non-IFRS financial measures to investors. Management does not consider these non-IFRS measures in isolation or as an alternative to financial measures determined in accordance with IFRS. These non-IFRS financial measures
are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-IFRS financial measures.
Additionally, to the extent that forward-looking non-IFRS financial measures are provided, they are presented on a non-IFRS basis without reconciliations of such forward-looking non-IFRS measures due to the inherent difficulty in forecasting and quantifying certain
amounts that are necessary for such reconciliation.
Additional Information
If the Transaction is pursued, SPAC will be required to file a preliminary and definitive proxy statement, which may include a registration statement, and other relevant documents with the SEC. You are urged to read the proxy statement/prospectus and any other relevant
documents filed with the SEC when they become available because, among other things, they will contain updates to the financial,industry and other information herein as well as important information about SPAC, the Company and the contemplated Transaction.
Shareholders will be able to obtain a free copy of the proxy statement (when filed), as well as other filings containing information about SPAC, the Company and the proposed Transaction, without charge, at the SEC’s website located at www.sec.gov.
Participants in the Solicitation
SPAC and the Company, and their respective directors and executive officers may be deemed to be participants in the solicitationof proxies from SPAC’s shareholders in connection with the proposed Transaction. A list of the names of such directors and executive officers
and information regarding their interests in the proposed Transaction will be contained in the proxy statement when available. You may obtain free copies of these documents as described in the preceding paragraph. The definitive proxy statement will be mailed to
shareholders as of a record date to be established for voting on the contemplated business combination when it becomes available.
Trademarks
This Presentation may contain trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners. Solely for convenience, some of the trademarks, service marks, trade names and copyrights referred to in this
Presentation may be listed without the TM, SM © or ® symbols, but such references are not intended to indicate, in any way, that SPAC or the Company will not assert, to the fullest extent under applicable law, their rights or the right of the applicable licensor to these
trademarks, service marks, trade names and copyrights.
Neither SPAC, the Company, nor any of their respective directors, officers, employees, affiliates, advisors, representatives or agents, make any representation or warranty of any kind, express or implied, as to the value that may be realized in connection with the Transaction,
the legal, regulatory, tax, financial, accounting or other effects of a Transaction or the accuracy or completeness of the information contained in this Presentation, and none of them shall have any liability based on or arising from, in whole or in part, any information
contained in, or omitted from, this Presentation or for any other written or oral communication transmitted to any person or entity in the course of its evaluation of the Transaction, and they expressly disclaim any responsibility or liability for direct, indirect, incidental,
exemplary, compensatory, punitive, special, or consequential damages, costs, expenses, legal fees, or losses (including lost income or profits and opportunity costs) in connection with the use of the information herein.
By accepting this Presentation, the recipient will be deemed to have acknowledge and agreed to the foregoing.
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Presenters
Stephen Lo, CPA, CFA
Chief Financial Officer
Danny Yeung
CEO & Co-Founder
Ben Cheng
Chief Executive Officer
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Adrian Cheng Led Team Backed by Inspirational Independent Directors
Dr. Adrian Cheng
Founder of Artisan Acquisition Corp.
William Keller
Independent Director
Mitch Garber, C.M.
Independent Director
Frank Yu
Independent Director
Sean O’Neill
Independent Director
Ben Cheng
Chief Executive Officer of Artisan Acquisition Corp.
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Prenetics is a Clear Fit for Artisan Acquisition Corp.
Focus on disruptive lifestyle
technologies in healthcare,
consumer, technology
Strong fundamentals with
significant value creation
opportunities
Well-positioned to deliver value
and synergies in the group’s
global cultural ecosystem
Growth upsides through tapping
global consumers’ unmet
demands & burgeoning markets
Target Criteria –
Clearly Met by Prenetics
1
2
3
4
5
Disrupting & decentralizing global healthcare with large global
opportunity of over US$1.3trn1
Strong R&D and product innovation capabilities backed by
experienced in-house team, strategic collaboration with Oxford
University and vibrant scientific ecosystem
First-mover advantage in target geographies with robust
product pipeline and high growth potential; well positioned
to replicate U.S. success stories in its target geographies
Inspirational founder backed by strong leadership team of tech,
biotech, healthcare and consumer veterans
Strong financial profile and highly attractive expected valuation relative
to peers
Source: Frost & Sullivan.
Notes: 1. Global opportunity as of 2030; represents global market sizes and target addressable markets, except for colorectal cancer screening which does not include mainland China.
Investment Thesis for
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Significant Synergies - Prenetics and Adrian Cheng’s Ecosystem
Significant Synergies
• Healthcare channel and
user access
• Broad network of
locations covering
healthcare, retail,
hospitality and other
sectors
• Extensive customer, user,
and fan base across
platforms
• Direct corporate use
cases across eco-system
Education &
Sports
Healthcare
& Wellness
Hospitality
Infrastructure
& Aviation
Roads
Logistics
Construction
Cultural Retail
Residential
Workspace
Services
Culture &
Social Innovation
Adrian Cheng's
14M Members
Global Eco-system
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Decentralizing Healthcare
Prevention,
Diagnostics and
Personalized Care
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Personalized Care Diagnostics
Prevention
Existing Products Future Products
Personalized nutrition,
hair & sexual health products
Covid-19 testing, POCT / At-home diagnostic
testing and medical genetic testing
Consumer genetic testing and
early colorectal cancer screening Decentralizing Healthcare
2025E
Revenue
$640mm
24.9%4
7.3%4 67.8%4
Global Opportunity: US$117 Billion+1
Global opportunity: US$848 Billion+3 Global opportunity: US$376 Billion+2
Source: Frost & Sullivan.
Notes: Global opportunity as of 2030. 1. Represents global target addressable market for early colorectal cancer screening (except for mainland China) and global market size for consumer genetic testing.
2. Represents global target addressable market for hair loss and erectile dysfunction and global market size for personalized nutrition. 3. Represents global market size for medical device. 4. Represents each
business segment revenue as % of total revenue expected in 2025.
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#1
Diagnostics / DNA
testing company in
HK and UK1
8 Labs
6 Airports in
HK & UK, and
2 main labs
$85M
Lifetime Fundraising
$205M
2021E
Revenue
700+
Total
Employees
5M+
Total tests
processed2
Notes: 1. By testing volume and TrustPilot Review. 2. Include CircleDNA and Covid-19
tests; as of August 31,2021.
Covid-19 PCR test enabled by in-house developed,
cloud-based, automated end-to-end solution with
capability to perform up to 40K tests daily2
Covid-19 rapid PCR quality testing developed by the
University of Oxford
Patent pending at-home rapid infectious disease testing
On-going development on at-home blood based testing
for routine health check
Whole exome sequencing with proprietary 31mm
datapoint algorithm
The only NMPA approved non-invasive colorectal
cancer screening test
OX-LAMP
Prevention
Diagnostics
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Strategic R&D Collaboration with Oxford University
Prenetics Molecular Diagnostics
Research Center at Oxford University
Oxford University
3-Year Research Grant
OSCAR – Oxford Suzhou Centre
for Advanced Research
Combined research with Oxford University enables
Prenetics to have its own research centre at Oxford
University
Prenetics R&D team already works closely with
Oxford team of Professors, with collaboration further
enabling us to commercialize novel inventions
Prenetics’ ROFR to acquire technology / IP
Key research directly with Oxford and the
team of professors from Mar 2021
Initial focus:
a) Improving sensitivity and time to results
of Covid-19 reagent
b) Development of enzymes to lower cost
c) Assay development (e.g. infectious
disease, STD)
Key research directly with
the only overseas research
centre by Oxford
Initial focus will be on
a) HealthPod general
development
b) HealthPod for Clinicians
development
Close Collaboration with Prenetics In-house R&D Teams
Dr. Lawrence Tzang, Ph.D.
Co-founder & Chief Science Officer
Scientific & Laboratory team
Dr. Senthil Sundaram, M.D.
Chief Clinical Officer
Clinical & Bioinformatician
team
Dr. Mike Ma, Ph.D.
Head of Clinical R&D
Clinical R&D team
Dr. Peter Wong, DPhil
Chief Technology Officer
Engineering & Development
team
Dame Caroline Wilson (British ambassador to China)
at OSCAR opening – June 2021
Frank Ong, MD
Chief Medical Officer
Circle Snapshot R&D & Setup
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World-class Leadership Team of Tech, Biotech, and Healthcare Pioneers
Management Team
Danny Yeung
CEO & Co-Founder
Stephen Lo, CPA, CFA
Chief Financial Officer
Lawrence Tzang, PhD
Chief Scientific Officer &
Co-Founder
Avi Lasarow
CEO – EMEA
Mike Ma, PhD
Head of Clinical R&D
Frank Ong, MD
Chief Medical Officer
Key Scientific Advisers
Prof. Zhanfeng Cui
Donald Pollock Professor of
Chemical Engineering,
University of Oxford
Prof. Wei Huang
Associate Professor in
Dept. of Engineering Science,
University of Oxford
Dr. Monique Andersson
Medical Advisor, Director of Microbiology,
Oxford University Hospitals,
NHS Foundation Trusts
Prof. Michael Yang
Chair Professor of Biomedical
Sciences, Vice-President (R&D)
City University of Hong Kong
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CircleDNA
The World’s Most Comprehensive
Consumer DNA Test
Prevention Leading
Brand
In Asia and UK
consumer
genomics
50-100x
More data than
the competitors
$19mm
2021E CircleDNA
Projected
Revenue
34%
2020A-2025E
Revenue CAGR
120k+
CircleDNA tests
delivered since July
2019 launch
$16bn+
Global Market
Size1
Source: Frost & Sullivan. Notes: 1. Global market size for DTC molecular testing services based on projection for 2030; Covid-19 testing service market is not
included while influence of Covid-19 has been considered in the market sizing.
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CircleDNA — An All-New Industry Standard in Genetic Testing
Genotyping
~600k
125
Reports
31 million
Whole Exome
Sequencing
500+
Reports
Genotyping Technology
● High false negative rate: Will miss
>90% mutations associated with
cancer and disease
● Pre-defined and specific SNP
Readings
● Limited Data, can only resolve
single letter “typos”
● Static, will need to test again as
science evolves
Our Next Generation -
Whole Exome Technology
● Read protein-coding genes
● Clinical-grade consumer testing
● 50–100x more data over
genotyping
● One test, a Lifetime of Value
● Identify >90% mutations
associated with cancer and
disease 23andMe
DNA Data Points
Source: Company Website, Company Filings.
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Family Planning Early Detection Precision Medicine Health & Disease
Origins Talents & Performance
Traits
Diet & Lifestyle
CircleDNA – the Forefront of Health Diagnostics & Disease Prevention Covering
Screening, Wellness, Proactive and Preventive Measures
500+ Reports Discovered Across 20 Categories A Snapshot of CircleDNA Tests
Family
Planning &
Disease
375 reports
Diet,
Wellness,
Lifestyle
69 reports
Traits
70 reports
103 Reports
Drug Response
157 Reports
Carrier Screening
36 Reports
Cancer Risk
6 Reports
Dementia &
Brain Health
65 Reports
Disease Risk
8 Reports
Common
Health Risk
8 Reports
Stress & Sleep
14 Reports
Skin
20 Reports
Nutrition
5 Reports
Pollution
Sensitivity
15 Reports
Diet
7 Reports
Well-Being
15 Reports
Ancestry
4 Reports
Gender Traits
18 Reports
Sports & Fitness
5 Reports
Behavioral Traits
9 Reports
Success Traits
12 Reports
Physical Traits
2 Reports
Music & Dance
5 Reports
Personality Traits
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CircleDNA Product Offering
USD 189
14 Categories – 125 Reports
Diet, Nutrition, Fitness, Stress,
Ancestry, Skin, and More
30 Mins Phone Consultation
USD 499 USD 499 USD 629
1 Category – 163 Reports
Carrier Screening of recessive
genetic diseases
30 Mins Phone Consultation
4 Categories – 115 Reports
Cancer, Common Health Risks,
Disease Risks, Dementia &
Brain Health
30 Mins Phone Consultation
20 Categories – 500+ Reports
Vital + Family Planning +
Health Bundle + Drug Response
30 Mins Phone Consultation (2x)
Vital Health Premium Family Planning
Retail
Price
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CircleDNA Marketing Strategy
Social Media Celebrity Ambassadors ATL Marketing
Van Ness Wu
Actor & singer
15M+
social media followers
G.E.M.
Asia’s Taylor Swift
50M+
social media followers
Gigi Leung
Actor, singer & mother
20M+
social media followers
TRAM WATSONS
TAXI BILLBOARD
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19
-
250
500
750
1,000
1,250
1,500
1,750
T+0 T+1 T+2 T+3 T+4 T+14
CircleDNA — Extraordinary Growth with Significant Runway
Forecasted Growth Trajectory after Launch1
(# of Cumulative Tests Sold, ’000)
623k (by 2025E)
~12M Market Size4
US$8.8 bn
APAC / EMEA
Consumer DNA Test
Market Size4
US$5.1 bn
US Consumer DNA Test
14 19 21
42 52 62
2020E 2021E 2022E 2023E 2024E 2025E
CircleDNA Revenue
(US$ millions)
2020 2021 2019
10,000
23andMe took 4 years to sell 100k tests,
which Prenetics achieved in less than 2 years
Source: Frost & Sullivan. Trust Pilot Review.
Notes: 1. Blue dotted line denotes management forecast; grey dotted line is extrapolation of 23andMe. 2. Market data as of August 31, 2021. 3. As of July 12, 2021.
4. Market size for DTC molecular testing services based on projection for 2030; Covid-19 testing service market is not included while influence of Covid-19 has been considered in the market sizing.
23andMe
Market cap of
$3.5bn2
2020A
Rating on Trust Pilot3
23andMe
1.9 / 5.0 4.6 / 5.0
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Project Screen
Covid-19 Testing
$32bn+
Global Market
Size1
8 Labs
6 Airports in HK &
UK, and 2 main
labs
5M+
Covid-19 Molecular
Test Performed
Diagnostics
$51mm
2020A Covid-19
Testing Revenue
77%
2020A-2022E
Revenue CAGR
Blue Chip
Clientele of
Governments &
Corporates
Source: Frost & Sullivan.
Notes: 1. Based on projection for 2021; represents global market size; only consists of tests performed in independent clinical laboratories.
Prenetics laboratory inside
Hong Kong International Airport
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Prenetics Response To Covid-19
• Airport testing in Hong Kong and the United Kingdom,
including HKIA1, Heathrow, Manchester, Stansted,
Luton, and Gatwick airports
• Converted smoking lounge to an ISO-15189 laboratory
at the HKIA1.Prenetics is the only Covid-19 testing
provider with operating lab in HKIA1
• Provides testing service up to 3,000 players and club
staffs for English Premier League on a regular basis
• ~2M tests serviced for HK government as of 1Q 2021
Community Testing
Hospital Authority
Department of Health
Food and Environmental Hygiene Department
(FEHD)
HK Government English Premier League Airport Testing to International & Local Airports
Note: 1. Hong Kong International Airport.
Extensive Partnerships Across Sectors
• Prenetics has become Virgin Atlantic's preferred at-
home testing provider, with customers able to order a
complete end-to-end travel testing bundle, tailored to
their destination
+ Virgin Atlantic Travel (2022E Revenue $89M) Entertainment & Sports (2022E Revenue $15M)
Virgin Atlantic, Carnival Cruise Line,
Cruise line operation of an entertainment company,
Hong Kong International Airport, Heathrow Airport,
London Luton Airport, London Stansted Airport,
Manchester Airport, Gatwick Airport
English Premier League, Professional Darts Corporation,
England and Wales Cricket Board,
British Academy Film Awards,
Sky TV, Global Media & Entertainment Company,
American Film & TV Studio
Key Highlights
|
|
22
Significant Upside as Travel “Resumes”
Covid-19 Testing Revenue Breakdown (US$ millions)
2020A 2021E
Travel Others
$51
$173
2%
98% 98% 55%
45%
799 # of Tests (’000) 5,688
Source: Frost & Sullivan. Notes: 1. 2020 financials based on management accounts – excludes airline & cruises revenue in EMEA as breakdown is not available. 2. Include
entertainment & sports, community testing & screening, corporate B2B testing, etc. 3. Based on projection for 2021; represents global market size; only consists of tests performed in
independent clinical laboratories.
2
$32bn+
Global Market Size3
1
3.4x
|
|
23
Major COVID-19 Testing Technologies Comparison
Through-put & Scalability
Use-Case
Availability
Mobility & Lab Required
Accuracy
Speed
Nucleic Acid
Amplification (RT-LAMP)
Reaction time:
15 – 20min
Higher: 96%
No Need Laboratory
No Lab Technicians
Yes
Symptomatic & Asymptomatic
Highly Scalable
Antigen Test
(Proteins)
Reaction time:
15 - 30min
Symptomatic: 90% or above
Asymptomatic: 27%
No Need Laboratory
No Lab Technicians
Yes
Symptomatic
(7 days of infection)
Highly Scalable
Nucleic Acid
Amplification Test (RT-PCR)
Reaction time:
4 – 6 Hours
Highest: 99%
Need Laboratory
Lab Technicians
Yes
Symptomatic & Asymptomatic
Not scalable
PCR-Quality Technology
from Oxford Source: Frost & Sullivan.
|
|
24
Game Changing POC / At-Home PCR-Quality Testing Technology from Oxford University
Rapid
15 – 20 mins (positive will be faster)
Speed that PCR can never achieve and scale
Accurate
96% Sensitivity
99.9% Specificity
Point-of-Care Technology
Application of advanced thermo-technology that
enables POC application and self-administration
Low Cost
Enabling frequent
testing
Scalable
No lab or specialist equipment
Throat or nasal swabs
OX-LAMP
Approvals / Recognitions
MHRA1 in UK
CE IVD2 in EU
• US FDA in process; Expected by
2021Q4 / 2022Q1
Inside Oxford Lab Developing
30-minute Coronavirus Test
Notes: 1. Medicines and Healthcare products Regulatory Agency. 2. Approved CE Marketing on In-Vitro Diagnostic medical devices.
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|
25 Source: Company Website. Please view Circle HealthPod Product video here: https://circlepod.co/.
|
|
Circle HealthPod
A Lab. In Your Pocket Launched in Hong Kong
To launch in EU, Southeast Asia and the US
Diagnostics
20min
Time to
result
$848bn+
Global Market
Size1
96% /
99.9%2
Sensitivity /
Specificity
Mobile &
Scalable
No lab or specialist
equipment
Painless
Pain-free
nasal swab
Detects Covid-19 with
PCR-Quality Technology
Influenza / Flu
STDs
Future Assays:
Source: Frost & Sullivan. Notes: 1. Represents global market size for medical device based on the projection for 2030. 2. According to trials done at University of Oxford when compared to PCR.
CE-IVD
Marked
Expect to receive
US FDA EUA by
Q1 2022
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|
27
Successful Commercialization Case Study: Cue Health
Source: Company Filings, Cue Health Company Website, Bloomberg, Reuters, CNBC.
Notes: 1. Per Bloomberg, as of December 2020.
The Cue Health Monitoring System
• The Cue Health Monitoring System is a fast, compact, highly portable testing platform with high
performance and accuracy, utilizing molecular diagnostic technology
• Cue Health's COVID-19 cartridge test is authorized by the US FDA for home use with no prescription in Mar
2021. The company filed for a US IPO on September 1, 2021
Over $2bn
Valuation1
$481mm
Contract
Granted from
US Gov’t
Go-to-Market Strategy: Key Partners & Target Clients
Enterprise Healthcare Provider Direct-to-Consumer Public Sector
Henry Schein
Fortune 500 Companies
Mayo Clinic
Hospitals / Private Clinics
E-commerce
In-store
US Department of Defense
Government Agencies
$202mm
1H 2021
Revenue
|
|
28
• In-patient and out- patient on-site screening
• Regular testing for healthcare workers & family
• For hotel guests as a complimentary item for their
stay or as a paid in-room service
• Must-have for every homes to for a peace of mind
• At-home testing
• On the go testing (with portable charger)
Use Case
Hospitals & Clinics Hotels & Apartments Private Use
NGO Community Screen Schools Sports & Entertainment
• Rapid testing for schools
• Regular testing for students and teachers
• Easy and simple test for NGO’s
• Regular testing for community members
• Rapid at-home testing for attendees
• Regular testing for players and staffs
|
|
29
Illustrative Representation of Diagnostic-testing Supply Chain
Assay
consumables
Subtier supply chain
Testingsites
Providers
Home/personal
Labs
Point-of-caresystems
Analyzer production
Reagents
Collection consumables
Manufacturingequipment/integration
Analyzer components
Cartridgecomponents
High-throughput
analyzers
Point-of-careanalyzers
Home-use
cartridges
Rapid-result
cartridges
To labs, testing sites, in-home test
kits, providers,and others
Assay kits
Level of vertical integration varies based on OEM, technology, and platform
Test/kit production Sample processing Sample collection
Degree of supply-chain constraint (e.g., capacity limitations, small number of suppliers)
Less constrained More constrained
Circle HealthPod
|
|
30
Circle HealthPod B2B Stations
Circle
HealthPod
Dashboard
Partners
App
Multiple Circle
HealthPods
|
|
31
Circle HealthPod Marketing Strategy – Partnering with International Actor
Donnie Yen on Extensive ATL Marketing Campaigns
TRAM
BILLBOARD
MTR
TAXI BUS
STATION
TVC
Notes: Initial marketing campaign focusing only for Hong Kong market.
|
|
ColoClear
The Only Non-Invasive Colon
Cancer Screening Test
Approved by NMPA
$101bn+
Addressable
market1
Successful
Model
Comparable to
ColoGuard
in the US
Cost
Effective
Comparing to
Colonoscopy
96%
Sensitivity -
Highly Accurate
Launching in Q1 2022E
Prevention
Source: Frost & Sullivan.
Notes: 1. Global target addressable market for colorectal cancer screening based on projection for 2030, except for mainland China; target population is the age group of 40-74 years old.
|
|
34
Significant Whitespace in Asia Markets Presents Attractive Growth Opportunities
10
27
50
98
2022E 2023E 2024E 2025E
39 99
266
454
810
2015A 2016A 2017A 2018A 2019A
Source: Frost & Sullivan.
Notes: 1. Before Exact Science’s acquisition of Genomic Health in November 2019, ColoGuard is the only major revenue source for Exact Sciences. 2. Market data as of August 31, 2021.
Colorectal Cancer Screening Market in US (2019) Colorectal Cancer Screening Market in HK & SEA (2019)
93.0M
Addressable
Population
128.2M
Addressable
Population
16.5%
Tested
5.7%
Tested
83.5%
Unscreened
94.3%
Unscreened
Revenue of ColoGuard for Exact Sciences1 (US$ mm) Projected Revenue of ColoClear for Prenetics (US$ mm)
60 160 300 600 104 244 572 1,680 934 Volume
(’000)
Volume
(’000)
Key addressable market for
(Market cap of $17.9+bn2)
Key addressable market for
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|
35
Strategic Technology Transfer from New Horizon to Launch ColoClear
Establishment of Strategic Partnership with New Horizon Health to Commercialize ColoClear
Source: Company Filings. Notes: USD/HKD FX rate of 7.78. 1. Market data as of August 31, 2021. 2. Including Singapore, Malaysia, Indonesia, Vietnam, Philippines and Thailand.
3. Gross profit = Gross Revenue – COGS for products sold – COGS for lab testing services – Sales & Marketing Expenses (including sales incentives and logistics costs).
Exclusive rights granted to
sell & process ColoClear in
Hong Kong and Macau;
expandable to Taiwan and
Southeast Asia2
Under a profit sharing
agreement, Prenetics and
New Horizon will equally
share gross profits3 from
sales of ColoClear
5 years of initial term
renewable for another 5
years by mutual consent
Completed technology
transfer from New Horizon;
certified by New Horizon to
perform ColoClear
testing at its lab
Exclusive 50:50 5+5 Years Technology
Transfer
+
(Listed on HKEX with market cap
of US$2.6bn1 and FY2020
revenue of US$10mm)
|
|
36
Non-invasive
Tests
Sensitivity
Specificity Detection
limitations
Sample size
needed
Dietary
restrictions CRC AA
gFOBT
(Hemoccult II) 40% 12% 98% Intermittent bleeding 3 bowel
movements Yes
FIT (Faecal
Immunochemical Test) 70% 22% 95% Intermittent bleeding Single sample No
FIT-DNA
(ColoGuard) 92% 65% 92% CRC and AA continuously
exfoliate cells Single sample No
FIT-DNA
(ColoClear) 96% 64% 87% CRC and AA continuously
exfoliate cells Single sample No
Diagnostic
Invasive Test
Sensitivity Specificity
CRC AA
Colonoscopy >95% 95% 90%
FIT-DNA has higher sensitivity when comparing with other non-invasive Colon Cancer screening tests.
Closest CRC sensitivity to
actual colonoscopy standards
ColoClear – Industry Leading Performance
Sensitivity=True positive /(True positive + False negative)*100%;
Specificity=True negative /(True negative + False negative)*100%.
Source: Company filings, Colorectal cancer development and advances in screening. Clin Interv Aging. 2016 July 19; 967-976.
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|
Circle SnapShot
Your annual health check at home Launching in Q1 2022E
Diagnostics
50+
Wide Range of
Tests for
Everyone
Digital Health
Platform
Track your Health
Progress
Successful
Model
Comparable to
Everlywell,
Letsgetchecked
$6bn+
Global Market
Size1
Painless
Blood collection
at home
Source: Frost & Sullivan.
Notes: 1. Global market size for at-home health testing based on projection for 2030; does not include home testing kits which do not require lab tests; Covid-19 at-home test has not been considered.
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|
39
Successful Commercialization Case Study: Everlywell
Source: Everlywell Company Website, Bloomberg.
Notes: 1. Per Bloomberg news article, as of March 2021.
Innovative at-home Health Testing
• Everlywell’s portfolio of 30+ at-home tests offer simple sample collection and physician-reviewed results and insights sent to
your device in 5 to 7 business days
• In March 2021, Everlywell announced its acquisition of PWNHealth and Home Access Health Corp. in a cash and stock deal. The
combined companies, re-branded as Everly Health, expects to support more than 20 million people annually in the US
$2.9bn
Valuation1
~$200mm
2020
Revenue1
Popular Everlywell Tests
Metabolism Indoor & Outdoor Allergy Sexually Transmitted Disease Food Sensitivity
Measure free
testosterone, cortisol and
TSH levels
Test for 40 common
indoor and outdoor
allergens
Screens for 7 common
sexually transmitted
infections
Measure body’s immune
systems’ IgC antibody
reactivity to 96 foods
|
|
Circle Medical
Genetic Testing for Physicians
$59bn+
Global Market
Size1
Successful
Model
Comparable to
Invitae, Natera
20+
Wide range of
tests for everyone
Launching in Q1 2023E
Diagnostics
Next Generation
Sequencing
Advanced
Technology
Source: Frost & Sullivan.
Notes: 1. Global market size for clinical molecular test service based on projection for 2030; Covid-19 testing service market is not included while influence of Covid-19 has been considered in the market sizing.
|
|
41
68
148
217
2017A 2018A 2019A
4.6
10.6
Today
(2021E)
2025E
4.6
9.2
2016A Today
(2021E)
Significant Growth Potential in Asia / Europe Markets Present Attractive Growth Opportunities
Medical Molecular Testing Market in US (US$ bn) Medical Molecular Testing Market in HK / SEA / Europe (US$ bn)
Source: Frost & Sullivan.
Notes: 1. Billable volume for 2018 – 2019. Accessioned volume for 2017. 2. Market data as of August 31, 2021. 3. While its geographic scope is not limited to certain
regions, it is expected to predominantly generate revenue in Hong Kong, SE Asia and Europe during the projection period.
2.0x 2.3x
Revenue for Invitae (US$ mm) Projected Revenue of Circle Medical for Prenetics3 (US$ mm)
26 38 56
2023E 2024E 2025E
150 292 469 Volume1
(’000)
Volume
(’000)
Target market size for
100 150 225
(Market cap of $6.4bn2)
US market size for
|
|
Circle One / F1x / Fem
Testing into personalized care Launching in 2022E-2023E
Personalized Care
Source: Frost & Sullivan.
Notes: 1. Based on CircleDNA customer survey conducted in Feb 2020. 2. Represents global target addressable market for hair loss and erectile dysfunction and global market size for personalized nutrition based on
projection for 2030.
Data-based
Personalized
solution based on
data analytics
Cross Selling
Leverage existing
CircleDNA customer
base
Recurring
Revenue
Subscription
model
63%
of CircleDNA
customers want
Circle One1
$376bn+
Addressable
market2
|
|
43
Successful Commercialization Case Study: Roman
Source: Roman Company Website, Bloomberg, PR Newswire, Fortune.
Notes: 1. Per Bloomberg, as of March 2021. Represents the post-money valuation of Ro, the operator of Roman.
2. Per Bloomberg, as of March 2021. Represents the lifetime fundraising of Ro, the operator of Roman.
Roman – Digital Health Clinic for Men
• Roman provides personalized solutions to men for the treatment of erectile dysfunction, hair loss,
premature ejaculation, etc.
• Roman’s daily vitamins and supplements are available in 4,600+ Walmart stores across the United States
$5bn
Valuation1
$876mm
Lifetime
Fundraising2
Key Partners
Pharmaceuticals Retailers Healthcare Sports & Entertainments
Pfizer
Greenstone
Walmart Ribbon Health
Quest Diagnostics
MLB
|
|
45
Existing Foundation
Lab Tests Required
Covid-19
Testing
CircleDNA
Circle HealthPod
3Q 2021
Circle Snapshot
Circle Medical
Circle One
Medical Community
Recognition
Customer & Data Sets
Covid-19 STD, Influenza
Prevention
Diagnostics
(same lab supporting multiple tests)
Extend Consumer Journey /
Lifetime Value (“LTV”)
ColoClear
Circle F1x / Fem Personalized
Care
2021 2022 2023
Product Extension
Physician
Detailing
Product Extension
Personalized nutrition, hair & sexual health products
At Home Health Tests
Medical Genetic Testing
Future Pipelines Post 1Q 2022
1Q 2022
1Q 2022
2022 2023
2023
Product Pipeline Built on a Robust Existing Foundation
|
|
46
13 1
(38) (26)
18
(169) (118) (157) (218)
(489)
(100) (121) (123)
(244)
(652)
(96) (134) (115) (131)
(216)
205 272 307 429
640
99 266
454
876
1,491
25 68 148 217 280 217 211 258 302 391
US$ millions
Revenue1
Operating Profit (Loss)1
2016A 2017A 2018A 2019A 2020A
Prenetics Delivering Favorable Metrics vs. US Peers 5 Years Ago
$1.3bn4 $17.9bn5 $0.25bn4 $6.4bn5
Multiple
Product &
Pipeline
Single
Product2:
Colorectal
Cancer Screening
Single
Product2:
Medical Genetic
Testing
$1.25bn3
Enterprise
Value
Notes: USD/HKD FX rate of 7.78. 1. 2021-2025 financials based on management forecast. Exact Sciences, Invitae and Natera historical financials sourced from company filings.
2. Indicates primary product focus. 3. Please refer to Transaction Summary page for further details. 4. Market data as of December 31, 2016. 5. Market data as of August 31, 2021.
Substantial revenue with
robust product pipeline
Efficient cost structure
2016A 2017A 2018A 2019A 2020A 2016A 2017A 2018A 2019A 2020A 2021E 2022E 2023E 2024E 2025E
$0.6bn4 $11.1bn5
Dual
Product2:
NIPT & Carrier
Screening
Market
Cap
c. 14x c. 26x c. 18x
|
|
47
$1.3bn+
$0.25bn+
Synergistic & Technology-enabling
Bolt-on Acquisition Opportunities
Liquid Biopsy Bioinformatics Long-read
Sequencing
$17.9bn+
$6.4bn+
Notes: 1. Market data as of December 31, 2016. 2. Market data as of July 12, 2021. 3. Please refer to Transaction Summary page for further details.
Market Cap
(2016)1
~10 Acquisitions
Market Cap
(Now)2
Tremendous Value Potential for Prenetics to be Unlocked via Synergistic Acquisitions
~13 Acquisitions
$1.25bn3
Enterprise Value
|
|
Financial Information
|
|
49
2019A
Revenue
$9mm
2021E
Revenue
$205mm
2025E
Revenue
$640mm
Prenetics Continues To Transform Itself, Now At An Incredible Rate
Notes: USD/HKD FX rate of 7.78. For financial projections, please refer to the "Use of Projections" portion of the disclaimer.
1. 2019 and 2020 financials based on audited accounts – Prevention segment revenue includes other service fees and adjustments. 2021 and 2025 financials based on management
forecast.
Revenue Evolution1
Multiple Shots on Goal, While Benefiting from Significant Customer and Operational Synergies Across Platform
2 Commercialized
Product Lines
4 Commercialized
Product Lines
7 Commercialized
Product Lines
CAGR of 58%
9.7%
90.3%
24.9%
7.3%
67.8%
Diagnostics
Personalized Care
Prevention
1 Commercialized
Product Line
2020A
Revenue
$65mm
21.9%
78.1%
100%
|
|
50
Driven by Robust Organic Growth and Product Launch Strategies
Diagnostics
Personalized
Care
Prevention
9 14 20 31 69 102 159 51
185 236 215
290
434
4 23
37
47
9
65
205
272 307
429
640
2019A 2020A 2021E 2022E 2023E 2024E 2025E
Revenue in US$ millions
Notes: USD/HKD FX rate of 7.78. For financial projections, please refer to the "Use of Projections" portion of the disclaimer.
1. 2019 and 2020 financials based on audited accounts – Prevention segment revenue includes other service fees and adjustments. 2021-2025 financials based on management
forecast.
Product Launch
Year
Personalized Care
124% CAGR
(22E-25E)
Diagnostics
54% CAGR
(20A-25E)
Prevention
61% CAGR
(19A-25E)
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|
51
COVID-19: An Opportunity to Better Reimagine Healthcare
Testing the New Norm
Self Care a Necessity
Brand & Trust
Network
Time to Market
New Technology
159
434
47
2019A 2020A 2021E 2022E 2023E 2024E 2025E
Prevention Diagnosis (ex. Covid-19 Testing)
Personalized Care Covid-19 Testing
Revenue in US$ millions1
We conservatively assumed COVID-19 testing market is not here to stay. Instead, it has allowed us the
opportunity to build the tools and expand our platform in order to better serve the new world order of
healthcare
Notes: USD/HKD FX rate of 7.78. For financial projections, please refer to the "Use of Projections" portion of the disclaimer.
1. 2019 and 2020 financials based on audited accounts – Prevention segment revenue includes other service fees and adjustments. 2021-2025 financials based on management
forecast.
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52
High Operating Efficiency Leading to High Growth
• Revenue growth driven by robust
organic expansion and product
launch strategies
• Significant market opportunity in
multiple verticals; Pipeline products
expected to benefit from customer
and operational synergies across
platforms
Notes: USD/HKD FX rate of 7.78. For financial projections, please refer to the "Use of Projections" portion of the disclaimer. 1. 2019 and 2020 financials based on audited accounts.
2021-2025 financials based on management forecast. 2. Excludes depreciation and amortization expenses. 3. Profit sharing to New Horizon for ColoClear is also included. 4. Non-
operating expenses primarily attributable to fair value adjustments for ESOP and convertible securities issued by the Company. Includes tax expense and tax credit.
• Significant positive momentum is
expected from 2024 onwards as
most products are in their high
growth stage
Financials in US$ million1 2019A 2020A 1Q21A 2021E 2022E 2023E 2024E 2025E
Revenue 9 65 57 205 272 307 429 640
YoY % NA 606% 1315% 215% 33% 13% 40% 49%
Gross Profit2 3 27 22 85 118 137 185 295
Gross Margin % 33% 41% 39% 41% 43% 45% 43% 46%
Sales & Marketing Expenses2 5 6 2 16 41 72 80 107
Research & Development Expenses2 2 2 1 30 36 50 64 83
Administrative and Other Expenses2,3 9 14 6 19 27 36 48 65
Adjusted EBITDA (Non-GAAP) (12) 4 12 21 14 (21) (7) 39
Adjusted EBITDA Margin % (131%) 7% 21% 10% 5% (7%) (2%) 6%
Depreciation and Amortization 2 2 1 8 13 17 20 21
ESOP & Other Non-Operating Expenses4 6 4 9 54 16 18 25 37
Net Profit / (Loss) (20) (2) 2 (41) (15) (56) (52) (19)
Net Profit Margin % (219%) (3%) 3% (20%) (6%) (18%) (12%) (3%)
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|
Transaction Overview
|
|
54
Transaction Summary
Illustrative Sources & Uses
Assumes 0% redemption by SPAC Shareholders
Illustrative Ownership1 Transaction Overview1
Illustrative Enterprise Value1
• Illustrative enterprise value of $1.25 billion
• Artisan Acquisition Corp. to merge with Prenetics
• An implied multiple of 4.6x 2022E Revenue and 4.1x 2023E Revenue
• Concurrent with the transaction, $60mm will be raised in a PIPE from Lippo, Dragonstone and Xen Capital at
$10.00 per share in addition to $60mm from forward purchase agreements (“FPAs”)
• All existing shareholders of Prenetics to rollover into the combined entity with no shareholders exiting. they will
maintain approximately 67% ownership
•Co-founder Danny Yeung and SPAC sponsor subject to a 18-month lock-up period to align with the Company’s
long-term interest
• Proceeds to be used for strategic acquisition or investments, R&D, product roll out, geographic expansion and
general corporate purposes
Sources
Existing Target Shareholder Equity Rollover $1,150
Sponsor Promote4 100
Cash Available in SPAC Trust Account 339
Forward Purchase Agreement 60
PIPE 60
Total Sources $1,709
Uses
Existing Target Shareholder Equity Rollover $1,150
Sponsor Promote4 100
Transaction Expenses 40
Net Cash to Balance Sheet 419
Total Uses $1,709
Share Price $10.00
Shares Outstanding (mm) 170.92
Illustrative Post-Money Equity Value $1,709
(-) Net Cash to Balance Sheet3 $455
Illustrative Enterprise Value $1,254
EV / 2022E Revenue 4.6x
EV / 2023E Revenue 4.1x
25.3%2
7.5%
67.3% Prenetics Equity Rollover
Artisan Shareholders
PIPE Investors (including the
investors under FPAs)
Notes: USD/HKD FX rate of 7.78. 1. Excludes (i) the impact of any equity awards issued at or after the closing of the transaction, (ii) the dilutive impact of 18.7mm warrants (11.3mm SPAC
public warrants, 5.9mm of sponsor warrants, 1.5mm of FPA warrants) with a strike price of $11.50 per share, and (iii) the impact of shares with super-voting rights. Includes 9.98mm total
Class B ordinary shares. 2. Includes SPAC directors. 3. Includes net cash to balance sheet of $419mm post the transaction, and Prenetics balance sheet net cash of $35.4mm, the pro-forma
amount of which includes a cash balance of $9.4mm as of 1Q 2021 and $26.0mm of proceeds from pre-IPO fundraising. 4. Includes total 9.13mm Class B ordinary shares held by the
Sponsor, 0.75mm Class B ordinary shares held by the FPA providers, and 0.1mm Class B ordinary shares held by SPAC directors.
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|
55
c. 420
(Circle SnapShot
& Circle Medical)
Sum-of-the-Parts Valuation: Today
(in US$ millions unless otherwise noted)
EV / CY23E
Revenue1
3 4
8.0x 6.0x 6.4x2 4.1x2
Intrinsic Enterprise Value of Prenetics Illustrative Enterprise Value
of Prenetics
3
7.0x
c. 1,970
c. 860
(Circle HealthPod)
c. 550
c. 1,280
c. 140
1,254
Notes: USD/HKD FX rate of 7.78. 1. Prenetics’ 2023 net revenue, which takes into account GST and transaction costs, from the management forecast used to calculate the implied
sum-of-the-parts valuation. 2. EV/CY2023E revenue calculated based on 2023E total net revenue including net revenue from Project Screen. 3. 23andMe, Invitae, Natera, Exact
Sciences and New Horizon Health were referenced for EV/revenue multiples on Prenetics’ prevention and personalized care business segment. 4. Autobio Diagnostics, Dr. Pal
PathLabs, Invitae, Metropolis Healthcare and Quidel were referenced for EV/revenue multiples on Prenetics’ diagnostics business segment. Project Screen business was not taken
into account in the valuation of the diagnostics business given the phaseout of the business from 2022 onwards.
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|
56
Peers’ Proven Successes Supported by Substantial Valuation
Prevention
Diagnostics
Personalized Care
Prenetics Products Peers1 Current Valuation /
Market Capitalization2
$3.5bn3
$2.6bn3
$2.0bn4
$2.9bn5
$6.4bn3
$5.0bn6 Roman Health
Source: Bloomberg. Notes: 1. Select companies with comparable products focused in the US / China. 2. Market cap for listed companies, or latest private round valuation. 3. Market
cap as of August 31, 2021. 4. Valuation reportedly discussed in the latest private round; per Bloomberg, as of December 2020. 5. Valuation after the acquisition of PWNHealth; per
Bloomberg, as of March 2021. 6. Post-money valuation for $500mm fundraising; per Bloomberg, as of March 2021.
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|
57
4.1x
15.8x
11.8x
7.3x 7.7x 7.8x
13.7x
9.3x
7.3x 7.1x
4.1x
Prenetics New Horizon
Health
Natera Invitae Exact
Sciences
23andMe Dr. Lal
PathLabs
Metropolis
Healthcare
Invitae Quidel Autobio
Diagnostics
4.6x
14.4x
9.6x 9.1x 9.0x
15.3x
10.5x 9.6x
7.1x 5.3x
Prenetics New Horizon
Health
Natera Invitae Exact
Sciences
23andMe Dr. Lal
PathLabs
Metropolis
Healthcare
Invitae Quidel Autobio
Diagnostics
Benchmarking Analysis
Source: Company disclosures, broker reports and FactSet as of August 31, 2021
1. Prenetics’ EV/revenue multiples are based on illustrative enterprise value of $1.254bn
EV / CY2022E Revenue Multiples
EV / CY2023E Revenue Multiples
Prenetics Prevention / Personalized Care Diagnostics
CY2022E Average: 16.1x CY2022E Average: 9.6x
CY2023E Average: 10.1x CY2023E Average: 8.3x
1
1
38.5x
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58
Select Precedent Transactions
EV/LTM
Date Acquiror Target Public / Private EV1 (US$m) Sales (x) EBITDA (x)
Apr-21 Private 3,000.0 ––
Apr-21 Public 1,624.3 3.9 22.3
Mar-21 Public 1,729.0 10.1 –
Feb-21 Private 3,500.0 11.5 –
Oct-20 Private 1,700.0 ––
Oct-20 Private 410.0 ––
Sep-20 Private 780.0 10.8 24.1
Sep-20 (80%) Private 309.6 ––
Jun-20 Private 886.0 17.7 nm2
Mar-20 Private 95.0 ––
Feb-20 Public 51.5 3.8 nm2
Jan-20 (Oncology) Private 37.0 3.7 –
Mean 1,343.5 8.8 23.2
Median 833.0 10.1 23.2
Notes: Public filings, Dealogic and MergerMarket.
1. Excludes earnout. 2. EV / LTM EBITDA multiple less than 0.0x.
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Appendix
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60 Sources & Notes: 1. Adults aged 65 or over in total 27 OECD countries as of 2014. OECD. 2. JAMA, https://www.healthleadersmedia.com/clinical-care/wasteful-spending-us-healthcare-estimated-760-billion-935-billion.
3. IHS Markit, https://ihsmarkit.com/research-analysis/global-healthcare-spend-to-remain-stable.html . 4. The Lifetime Distribution of Health Care Costs: Berhanu Alemayehu, Kenneth E Warner, et al. (June 2004).
Reactive Infrequent passive touch-points with healthcare system
Late Stage Focus Focused on treating already sick people
Vicious Cycle As more people get sick, they require more
resources, leaving fewer resources to keep people healthy
6/10
of Global Population
Lives with Two or More
Chronic Diseases1
59%
% Relative Lifetime
Healthcare Expenditure
at Age 65 or Over4
US$8.8trn
Global Healthcare
Spending in 20213
Conventional Healthcare Is No Longer a Viable Solution
Dysfunctional “Sick-care As Healthcare” Is Ripe for Disruption
1 / 4
Wastage in US
Healthcare Spending2
Aging Population & Chronic Disease Burden
Adding significant burden to healthcare system
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61
Asia Based, Global Presence
• Operating presence
Across Asia: China
(Hong Kong & Beijing1),
Singapore, India,
Malaysia, the
Philippines, Thailand,
and Vietnam
Europe & Africa HQ
London
Global HQ
Hong Kong
Research Partner
Oxford University
Prenetics-Oxford Innovation
Tech Centre for Advanced
Molecular Diagnostics
Suzhou, China
HealthPod
US FDA
Approval
Expected by
4Q21 / 1Q22
Note: 1. Operates through a joint venture.
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62
Key Milestones
Corporate Events Fundraising
• Founded in
2014
• ColoClear
launch
• Planned Circle
SnapShot
launch
• Planned Circle
One / F1x /
Fem launch
• Planned Circle
Medical launch
• Launched the
first genetic
test
• Acquired
DNAFit
• Launched new
consumer DNA
test –
CircleDNA
• $17.5M Series D
• Start Covid-19
testing in HK & UK
• Covid-19 testing in
6 airports globally
• Strategic
partnership &
R&D Collaboration
• $2.3M Series A • $5.5M Series B • $34M Series C
2014 2016 2017 2018 2019 2022 onwards 2020 2021
• ~4M Covid-19
tests
processed1
• HealthPod
launch
• $26M Pre-IPO
Note: Logos under each fundraising round represent the lead / key investors. 1. As of June 2021.
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63
SnapShot is both an off-the-shelf and white-label solution
(including API functionality) offering an E2E service.
This includes fulfilling the blood test kits, delivering to the
customer including returns, processing of samples and
release of results.
SnapShot is a user-friendly results delivery system that
capitalises on market trends and consumer expectations.
The device will work to analyse blood markers across
health categories including, for example:
… and many more
Liver Function
Heart Health
Diabetes Risk
Men’s Health
Women’s Health
Digital SnapShot of Your Health
Circle SnapShot
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64
Illustrative SnapShot Tests – Planned Launching in 2022E
C
Women’s Health
HPV test
Folic Acid
Women’s Fertility Test
……
D
Diet & Energy
Food Sensitivity
Metabolism Test
Thyroid Test
Vitamin D and Inflammation
……
E Diabetes Risk
HbA1c
……
A
Heart Health
Total Cholesterol
HDL
LDL
……
B
Men’s Health
Testosterone test
Liver Function
General men’s health test
Test at home Free tele
consultation Buy online Get fast results E-prescription
and services
Circle SnapShot
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Moving into Medical Genetic Testing (Circle Medical) – Launching in 2023E
Single Gene Testing
Rapid & Low-Cost
20 Genes
BRCA1
BRCA2
APOE
CYP2C19
CHEK2
FH
Monogenic Panels
15+ Specialities
500+ Panels
Oncology
Reproductive Health
Neurology
Pediatrics
Immunology
Hematology
Exome Sequencing
1,000’s of
Rare Diseases
Confirm the diagnosis for
complex or unclear symptoms
Identify or rule out the mutation
that causes the symptoms
Genome Sequencing
Most
Comprehensive
1,000’s of Rare Diseases
Point Mutations
Structural Variants
Complex Mutations
Non-Coding Mutations
Disease Susceptibility
Revealing the cause of genetic diseases | Targeted and symptoms-based diagnostic testing
Circle Medical
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Personalized Health Products – Planned to start from 2022
Source: Frost & Sullivan.
1. Global market size for personalized nutrition based on projection for 2030. 2. Global target addressable market for hair loss and erectile dysfunction for 2030.
Near-term Plan Future Solutions
Personalized Supplements
• Unique formulas to meet individual genetic
variations
• Supplements tailored to each individual’s
unique biology
$10B+1
Circle F1x / Fem
• Hair loss, erectile dysfunction, etc.
$366B+2
Circle One / F1x / Fem
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67
How It Works
31M
Genetic Data Points1
Combine Customer
and Genetic Data
Personalized
Supplements 120K+
Customer Data1
Unspoken
Needs Solutions
Use Algorithm to
Process the Data
Circle One / F1x / Fem
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Summary Financials
Notes: USD/HKD FX rate of 7.78. For financial projections, please refer to the "Use of Projections" portion of the disclaimer.
1. 2019 and 2020 financials based on audited accounts except by-product revenues which are based on management accounts. 2021-2025 financials based on management forecast.
2. Excludes depreciation and amortization expenses. 3. Profit sharing to New Horizon for ColoClear is also included.
Financials in US$ million1 2019A 2020A 1Q20A 1Q21A 2021E 2022E 2023E 2024E 2025E
Prevention 9 14 4 4 20 31 69 102 159
- Circle DNA NA NA NA NA 19 21 42 52 62
- ColoClear - NA NA NA 1 10 27 50 98
- Others NA NA NA NA -----
Diagnostics - 51 - 54 185 236 215 290 434
- Project Screen - 51 - 54 173 162 32 6 -
- Circle HealthPod ---- 12 56 123 177 243
- Circle SnapShot ----- 18 35 69 135
- Circle Medical ------ 26 38 56
Personalised Care ----- 4 23 37 47
Revenue 9 65 4 57 205 272 307 429 640
Prevention2 3 5 2 1 9 16 38 57 88
Diagnostics2 - 21 (0) 21 76 100 89 109 180
Personalised Care2 ----- 2 11 19 26
Gross Profit2 3 27 2 22 85 118 137 185 295
Total Marketing Expenses2 5 6 2 2 16 41 72 80 107
Administrative Expenses2 9 14 2 6 19 27 36 48 65
Research & Development Expenses2,3 2 2 0 1 30 36 50 64 83
Adjusted EBITDA (12) 4 (2) 12 21 14 (21) (7) 39
Depreciation and Amortization 2 2 0 1 8 13 17 20 21
Adjusted EBIT (14) 2 (3) 11 13 1 (38) (26) 18
Net interest expense 0 0 0 0 (0) 0 0 0 0
Other expense / (income) 0 (0) 0 (1) -----
ESOP 4 2 1 0 12 16 18 25 37
Net Operating Profit / (Loss) (18) 1 (4) 11 1 (15) (56) (52) (19)
Other Non-Operating Expense 3 5 0 7 41 ----
Profit / (Loss} before taxation (21) (4) (4) 4 (41) (15) (56) (52) (19)
Income Tax / (Credit) (1) (2) (3) 2 0 ----
Net Profit / (Loss) (20) (2) (1) 2 (41) (15) (56) (52) (19)
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Expected to be cash flow
generative by 2025E
due to product ramp-up
6 8
37
71 69
48
(11)
2019A 2020A 2021E 2022E 2023E 2024E 2025E
Conservative Cash Management & CAPEX Planning
Cash Burn Rate in US$ millions CAPEX in US$ millions
3 8 0 0
30
80
60
40
20
4
3
5 6
38
81
62
42
22
2019A 2020A 2021E 2022E 2023E 2024E 2025E
PP&E Intangibles Others Total
• Large increase in CapEX
expected from 22-24E to
budget for IP acquisition
in relation to R&D
technology
• Expected decrease in
CapEX as a percentage of
revenue as new product
offerings continue to
mature
• Cash burn rate (from
operating and investing
activities) averaging at
US$43 million per year
in 21-25E
• Continuous R&D and
product
commercialization
efforts help position
company for growth and
profitability in the long-
term
• Strong fundraising track
record to support the
financing of company’s
business expansion
plans
% of Revenue
9% 19% 30% 20% 10% 3%
Notes: USD/HKD FX rate of 7.78. For financial projections, please refer to the "Use of Projections" portion of the disclaimer.
1. 2019 and 2020 financials based on audited accounts. 2021-2025 financials based on management forecast. 2. Others include acquisition of subsidiary and investment in joint
venture / associate as recorded on cash flow statement.
1 2 2 2
50%
2
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70
Product Portfolio Summary
Product Launch Date IP Ownership Developed Product
In-House
Distribution
Exclusivity
Distribution
Region1
Distribution
Timeline
Current Consumer
Base
Circle DNA July 2019 Yes Yes Yes Asia, EMEA In Distribution
120k+ tests
delivered since 2019
launch
ColoClear 1Q 2022E
Technical transfer
from New Horizon
Health
No Yes SE Asia, HK,
Taiwan, Macau Q1 2022E N/A
Project Screen 2020 Yes Yes Yes HK, UK In Distribution
~4 million covid-19
molecular tests
performed
Circle HealthPod Q3 2021E Yes In collaboration with
Oxford University Yes Asia, EMEA Q3 2021E N/A
Circle SnapShot 1Q 2022E Yes Yes Yes Asia, EMEA 1Q 2022E N/A
Circle Medical 1Q 2023E Yes Yes Yes Asia, EMEA 1Q 2023E N/A
Circle One 2022-2023E Yes Yes Yes Asia, EMEA Q4 2022E N/A
Source: Company Website, Company Filings.
Notes: 1. Excludes Mainland China.
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Risks Related to Prenetics’s Business and Industry
Risks Related to Diagnostic Testing/Personal Genetics Business
1. A significant portion of Prenetics’s historical revenue were and near-term revenue will be generated from sales of its COVID-19 test kit and services, for which the demand may be substantially reduced with the production and widely administered use of an efficacious
vaccine or treatment for COVID-19, and failure of Prenetics to launch other new products and expand its overall customer base would harm its business and results of operation.
2. The diagnostic testing market, particularly with respect to COVID-19 diagnostic tests, is highly competitive, and many of Prenetics’s competitors are larger, better established and have greater financial and other resources.
3. The personal genetics market is highly competitive, and many of Prenetics’s competitors are more established and have stronger marketing capabilities and greater financial resources, which presents an ongoing threat to the success of its personal genetics business.
4. Prenetics’s near-term business strategy and R&D efforts are centered around POCT / at-home infectious disease testing, at-home blood-based routine health checks, and clinical genomics for which the market is new and rapidly developing, making it difficult to
evaluate the future prospects of its business.
5. Prenetics’s near-term success is highly dependent on the successful launch of Circle HealthPod and commercialization of its COVID-19 test kit in other jurisdictions, and these products may not attain market acceptance, meet customer demands or be successfully
commercialized in all or any of these jurisdictions especially due to its limited operating experience in such jurisdictions, which could negatively impact its future prospects.
6. Prenetics relies on several third-party manufacturers for the manufacturing, quality-testing, assembly and shipping of its COVID-19 test kit and other products. Any variation or termination of existing arrangements may require changes to sub-manufacturing
arrangements which may affect Prenetics’s ability to sell and distribute its COVID-19 test kit and other products temporarily and may adversely affected its business.
7. Clinical trials necessary to support a future test kit submission will be expensive and may require the enrollment of large numbers of subjects, and suitable subjects may be difficult to identify and recruit. Delays or failures in Prenetics’s clinical trials will prevent it from
commercializing any modified or new test kits and will adversely affect its business, operating results and prospects.
8. If the third parties engaged by Prenetics to conduct clinical trials and to assist with pre-clinical development do not perform as contractually required or expected, Prenetics may not be able to obtain regulatory approval for or commercialize its products.
9. The initial use of Prenetics’s test kits requires users to follow instructions, and not adhering to instructions may lead to negative outcomes, which could harm the user experience and customer perception of Prenetics’s products.
10. If Prenetics’s test kits, devices or services do not perform as expected, its reputation, business and operating results will suffer.
11. If Prenetics is not successful in leveraging its platform to develop and commercialize additional test kits or in enhancing features and services of existing product, its ability to expand its business and achieve its strategic objectives would be impaired.
Other Business Risks
1. Prenetics has incurred net losses since its inception and it anticipates that it will continue to incur losses for the foreseeable future, which could harm its future business prospects.
2. Prenetics is an early-stage company and has a limited operating history, which may make it difficult to evaluate its current business and predict its future performance.
3. Prenetics has a number of pipeline products that are currently in R&D phase, including Circle Medical, Circle SnapShot, future assays of Circle HealthPod, Circle One and F1X and Fem, and may not be successful in its efforts to development of marketable products.
Any failure to develop these products or any delay in the development could adversely affect its revenues and results of operations.
4. Prenetics has a limited history introducing new products and services to its customers. The future prospects of its business may be harmed if its efforts to attract new customers and engage existing customers with enhanced products, including the anticipated launch
of Circle HealthPod, a rapid POCT / at-home detection system for infectious diseases in August 2021, are unsuccessful.
5. Prenetics may not be able to achieve or maintain satisfactory pricing and margins, and its pricing strategies may not meet customers’ price expectations, which could adversely affect its revenues and results of operations.
6. Prenetics has increased and expects to further expand the size of its organization, and it may experience difficulties in managing its growth. If Prenetics is unable to manage the anticipated growth of its business, its future revenue and operating results may be
harmed.
7. Prenetics’s partnership with certain celebrities and key opinion leaders and use of social media and email may adversely affect Prenetics’s reputation.
8. Prenetics relies substantially on its research collaboration with Oxford University for development and commercialization of its POCT / at-home infectious disease testing products. If Oxford University is unable to achieve projected development milestones or produce
any meaningful research results, or experiences delays in doing so, Prenetics may not be able to capitalize on its investment in the collaboration projects and its business may be adversely affected.
9. Prenetics relies on a limited number of suppliers for test kit materials and for manufacturing and performing services for CircleDNA customers and may not be able to find replacements or immediately transition to alternative suppliers, which could adversely affect its
ability to meet customer demand.
10. The operating results of Prenetics may fluctuate significantly, which makes its future operating results difficult to predict and could cause its operating results to fall below expectations.
11. Prenetics’s business significantly depends upon the strength of Prenetics’s brands, including Prenetics, CircleDNA and DNAFit, and any harm to Prenetics’s brands or reputation may materially and adversely affect its business and results of operations.
12. If Prenetics cannot provide quality technical and customer and user support, it could lose customers and its business and prospectus will suffer.
13. If Prenetics is unable to successfully expand its sales and marketing to match its growth, its business may be adversely affected.
14. Prenetics is highly dependent on its senior management team and key personal, and its business and operating results could be harmed if it is unable to retain senior management and to attract and retain qualified personnel necessary for its success.
15. The sizes of the markets and forecasts of market growth for the demand of Prenetics’s products and services are based on a number of complex assumptions and estimates, and may be inaccurate.
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72
Risks Related to Prenetics’s Business and Industry (Cont’d)
Other Business Risks (Cont’d)
16. Prenetics may need to raise additional funds to develop its platform, commercialize new products or expand its operations, and it may be unable to raise capital when needed or on acceptable terms.
17. Prenetics plans to enter new business areas, such as clinical genomics and personalized nutrition products, where Prenetics does not have any experience or has minimal experience. Prenetics would likely face competition from entities more familiar with those
businesses, and Prenetics’s efforts may not succeed.
18. Prenetics may engage in acquisitions, investments or strategic alliances in the future, which could require significant management attention and resources, and could negatively affect its business, financial condition and results of operations.
19. Prenetics may incur debt or assume contingent or other liabilities or dilute Prenetics’s shareholders in connection with acquisitions or strategic alliances.
20. The United Kingdom’s withdrawal from the European Union could have an adverse impact on Prenetics’s business.
21. If Prenetics or its third-party collaborators experience any business disruptions, Prenetics’s operations and financial condition could be seriously harmed.
22. If Prenetics or PubCo fails to implement and maintain an effective system of internal controls, PubCo may be unable to accurately report its results of operations, meet its reporting obligations or prevent fraud.
23. Any significant disruption in service on Prenetics’s website, mobile applications, or in Prenetics’s computer or logistics systems, whether due to a failure with Prenetics’s information technology systems or that of a third-party vendor, could harm Prenetics’s reputation
and may result in a loss of customers.
Risks Related to Government Regulation
1. Prenetics’s test kits and testing devices are subject to various regulatory guidelines and any identified deficiencies or quality issue in the components of the test kits and testing devices could result in product recalls and could harm its reputation, business and
financial results.
2. Prenetics’s business collects and processes a large amount of data including personal information, and Prenetics will face legal, reputational, and financial risks if Prenetics fails to protect its customers’ data from security breaches or cyberattacks. Prenetics is also
subject to various laws and regulations relating to privacy or the protection or transfer of data relating to individuals, and any change in such laws and regulations or any failure by Prenetics to comply with such laws and regulations could adversely affect Prenetics’s
business.
3. Prenetics’s products and services are and will continue to be subject to extensive regulation, compliance of which could be costly and time-consuming or may cause unanticipated delays or prevent the receipt of the required approvals to offer Prenetics’s products and
services.
4. Prenetics plans to expand operations to various jurisdictions in which it does not currently operate or where Prenetics has limited operating experience and where Prenetics may be subject to increased regulatory risks and local competition. If Prenetics is unsuccessful
in any efforts to expand internationally, its business may be harmed.
Risks Related to Intellectual Property and Legal Proceedings
1. Prenetics depends, and may depend in the future, on intellectual property licensed from third parties, such as license from New Horizon Health for development and commercialization of ColoClear, and the expiration of such intellectual property, or the failure of such
third parties to maintain or protect such intellectual property, or the termination of the licenses or other agreements permitting Prenetics to use such intellectual property could result in the loss of significant rights, which would harm its business.
2. Adverse publicity about any investigation, litigation, regulatory or legal action against Prenetics or its senior management could harm its reputation and business.
3. Prenetics does not currently own any issued patents. If Prenetics is unable to obtain, maintain and protect its intellectual property rights and proprietary information or prevent third-parties from making unauthorized use of its technology, its business could be harmed.
4. Prenetics may be subject to claims that its employees, consultants or independent contractors have wrongfully used or disclosed confidential information of third parties or that Prenetics’s employees have wrongfully used or disclosed alleged trade secrets of their
former employers.
5. Prenetics may be involved in patent litigation or other intellectual property infringement claims or administrative proceedings with respect to intellectual property, which could result in substantial costs and expenses, substantial liability for damages and may disrupt
its business and operations.
6. Patent terms may be inadequate to protect Prenetics’s competitive position on its products and services for an adequate amount of time.
7. Prenetics may be subject to legal proceedings and litigation, which are costly to defend and could materially harm its business and results of operations.
8. Prenetics uses certain open-source technology in its business and may use other open-source technology in its business in the future. It may face claims from open-source licensors claiming ownership of, or demanding the release of, the technology and any other
intellectual property that it developed using or derived from such open-source technology.
9. Prenetics has not commissioned a formal external freedom to operate analysis with respect to its products or product candidates, and Prenetics may not be aware of issued patents that a third-party might assert are infringed by Prenetics’s current or future products,
which could materially impair its ability to commercialize such products.
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73
Step 1 Step 2
• New Cayman Listco and Merger Sub 1 are formed**
• Merger Sub 1 merges into Artisan SPAC
• Outstanding Artisan SPAC stock and warrants cancelled
in exchange for New Listco stock and warrants
• Transaction is intended to qualify for Artisan SPAC
security holders as a§368(a)(1)(F) tax-free
reorganization for U.S. federal income tax purposes
*For illustrative purpose, we assume new public parent will be Cayman companies.
**New Listco is formed by a non-U.S. person (e.g. Target CEO), or otherwise satisfies the business contacts test.
Resultant Transaction
Artisan SPAC
(Cayman)
Artisan
Shareholders
New Listco
(Cayman*)
Merger
Listco stock,
warrants
Merger Sub 1
(Cayman*)
Transaction Structure
Reorganization Steps
Listco
(Cayman)
Prenetics Group
(Cayman)
Merger Sub 2
(Cayman)
Listco stock
• Listco forms Cayman Merger Sub 2
• Merger Sub 2 merges into Prenetics Group, with Prenetics Group
surviving
• Outstanding Prenetics Group stock cancelled in exchange for Listco stock
• Share exchange is intended to qualify as tax-free for U.S. federal income
tax purposes under§368(a); may also qualify under§351 depending on
size of Prenetics shareholders’ percentage ownership of Listco
Listco
(Cayman)
Prenetics Group
(Cayman)
Artisan SPAC
(Cayman)
Artisan SPAC
(Cayman)
Artisan
Shareholders
Prenetics
Shareholders
Artisan
Shareholders
Prenetics
Shareholders
Merger
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Forward-Looking
Statements
This
document contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange
Act that are based on beliefs and assumptions and on information currently available to Artisan and Prenetics, and also contains certain
financial forecasts and projections.
All
statements other than statements of historical fact contained in this document, including, but not limited to, statements as to future
results of operations and financial position, Prenetics’ plans for new product development and geographic expansion, objectives
of management for future operations of Prenetics, projections of market opportunity and revenue growth, competitive position, technological
and market trends, the sources and uses of cash from the proposed transaction, the anticipated enterprise value of PubCo following the
consummation of the proposed transaction, anticipated benefits of the proposed transaction and expectations related to the terms of the
proposed transaction, are also forward-looking statements. In some cases, you can identify forward-looking statements by the following
words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,”
“plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,”
“potential,” “continue,” “ongoing,” “target,” “seek” or the negative or plural
of these words, or other similar expressions that are predictions or indicate future events or prospects, although not all forward-looking
statements contain these words. These statements are based upon estimates and forecasts and reflect the views, assumptions, expectations,
and opinions of Artisan and Prenetics, which involve risks, uncertainties and other factors that may cause actual results, levels of
activity, performance or achievements to be materially different from those expressed or implied by these forward-looking statements.
Any such estimates, assumptions, expectations, forecasts, views or opinions, whether or not identified in this document, should be regarded
as indicative, preliminary and for illustrative purposes only and should not be relied upon as being necessarily indicative of future
results. Although each of Artisan, Prenetics and PubCo believes that it has a reasonable basis for each forward-looking statement contained
in this document, each of Artisan, Prenetics and PubCo caution you that these statements are based on a combination of facts and factors
currently known and projections of the future, which are inherently uncertain. In addition, there will be risks and uncertainties described
in the proxy statement/prospectus on Form F-4 relating to the proposed transaction, which is expected to be filed by PubCo with the SEC
and other documents filed by Artisan or PubCo from time to time with the SEC. These filings may identify and address other important
risks and uncertainties that could cause actual events and results to differ materially from those expressed or implied in the forward-looking
statements. Forward-looking statements in this document include statements regarding the proposed transaction, including the timing and
structure of the transaction, the proceeds of the transaction and the benefits of the transaction. Neither Artisan, Prenetics nor PubCo
can assure you that the forward-looking statements in this document will prove to be accurate. These forward-looking statements are subject
to a number of risks and uncertainties, including the ability to complete the business combination due to the failure to obtain approval
from Artisan’s shareholders or satisfy other closing conditions in the business combination agreement, the occurrence of any event
that could give rise to the termination of the business combination agreement, the ability to recognize the anticipated benefits of the
business combination, the amount of redemption requests made by Artisan’s public shareholders, costs related to the transaction,
the impact of the global COVID-19 pandemic, the risk that the transaction disrupts current plans and operations as a result of the announcement
and consummation of the transaction, the outcome of any potential litigation, government or regulatory proceedings and other risks and
uncertainties, including those to be included under the heading “Risk Factors” in the registration statement on Form F-4
to be filed by PubCo with the SEC and those included under the heading “Risk Factors” in the final prospectus of Artisan
dated May 13, 2021 and in its subsequent quarterly reports on Form 10-Q and other filings with the SEC. In light of the significant uncertainties
in these forward-looking statements, you should not regard these statements as a representation or warranty by Artisan, Prenetics, PubCo,
their respective directors, officers or employees or any other person that Artisan, Prenetics or PubCo will achieve their objectives
and plans in any specified time frame, or at all. The forward-looking statements in this document represent the views of Artisan, Prenetics
and PubCo as of the date of this document. Subsequent events and developments may cause those views to change. However, while Artisan,
Prenetics and PubCo may update these forward-looking statements in the future, Artisan, Prenetics and PubCo specifically disclaim any
obligation to do so, except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements
as representing the views of Artisan, Prenetics or PubCo as of any date subsequent to the date of this document. Accordingly, undue reliance
should not be placed upon the forward-looking statements.
Important
Additional Information Regarding the Transaction Will Be Filed With the SEC
In
connection with the proposed transaction, PubCo will file a registration statement on Form F-4 with the SEC that will include a prospectus
with respect to PubCo’s securities to be issued in connection with the proposed transaction and a proxy statement with respect
to the shareholder meeting of Artisan to vote on the proposed transaction. Shareholders of Artisan and other interested persons are encouraged
to read, when available, the preliminary proxy statement/prospectus as well as other documents to be filed with the SEC because these
documents will contain important information about Artisan, Prenetics and PubCo and the proposed transaction. After the registration
statement is declared effective, the definitive proxy statement/prospectus to be included in the registration statement will be mailed
to shareholders of Artisan as of a record date to be established for voting on the proposed transaction. Once available, shareholders
of Artisan will also be able to obtain a copy of the F-4, including the proxy statement/prospectus, and other documents filed with the
SEC without charge, by directing a request to: Artisan Acquisition Corp., Room 1111, New World Tower 1, 18 Queen's Road, Central, Hong
Kong. The preliminary and definitive proxy statement/prospectus to be included in the registration statement, once available, can also
be obtained, without charge, at the SEC’s website (www.sec.gov).
Participants
in the Solicitation
Artisan,
Prenetics and PubCo and their respective directors and executive officers may be considered participants in the solicitation of proxies
with respect to the potential transaction described in this document under the rules of the SEC. Information about the directors and
executive officers of Artisan and their ownership is set forth in Artisan’s filings with the SEC, including its final prospectus
dated May 13, 2021 and subsequent filings on Form 10-Q and Form 3. Additional information regarding the persons who may, under the rules
of the SEC, be deemed participants in the solicitation of Artisan’s shareholders in connection with the potential transaction will
be set forth in the registration statement containing the preliminary proxy statement/prospectus when it is filed with the SEC. These
documents are available free of charge at the SEC’s website at www.sec.gov or by directing a request to Artisan Acquisition Corp.,
Room 1111, New World Tower 1, 18 Queen's Road, Central, Hong Kong.
No
Offer or Solicitation
This
document is not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities or in respect of
the potential transaction and does not constitute an offer to sell or a solicitation of an offer to buy any securities of Artisan, Prenetics
or PubCo, nor shall there be any sale of any such securities in any state or jurisdiction in which such offer, solicitation or sale would
be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction. No offer of securities shall
be made except by means of a prospectus meeting the requirements of the Securities Act.
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