The opportunity exists for wholesale investors to express interest in an in an investment in Knewe Biosystems Ltd (“Knewe”). Knewe was formed in 2017 to commercialise Knewe® products, which are breakthrough inventions that significantly improve all three aspects of animal husbandry - increased productivity, enhanced animal welfare and reduced environmental impact. Knewe’s primary activities of the last three years have been focused on getting improved definition of these benefits, and development of manufacturing and sales strategies for supplying it’s addressable markets. Knewe has now reached the point of launching full commercialisation in New Zealand, and extending market development to Australia, Europe (including the UK) and then North America.
The Knewe Board intended to seek new investment in Knewe of a further $A6,000,000, by way of a new share issue, however, due to Covid 19 this strategy has been deferred for up to nine months. Knewe has now decided to commence an interim capital raise by way of Convertible Notes up to A$1,000,000. These funds (in aggregate) will be invested in further market development, funding the growth in stock holding and the appointment of key full-time staff to take Knewe to the next stage in its development. Funds are also required for further strengthening intellectual property protection.
The deferred issue of new shares is now likely to proceed sometime in late 2020. Knewe will be aiming to raise a total of A$6.0m in this issue, and part of the funds raised will be utilised to repay RCN’s where investors seek repayment rather than conversion. We also expect that the relationship with the major agri-business will have been finalised by this time.
The offer of Convertible Notes described in the Information summary gives investors a
chance to invest in a business which is now well past its “start-up” stage, and is making progressing towards full commercialisation. The investment will initially provide a return of 7% per annum, with the option to be either repaid in eighteen months or be
converted to ordinary shares in Knewe.
Knewe intends a make new share issue offer within 9 months, and meanwhile, offers investors the opportunity to participate in anissue of convertible notes.
The funds being raised in this Convertible Note issue will allow Knewe to;
- Strengthen its Intellectual Property protection.
- Provide sufficient working capital until the new share issue.
- Strengthen Knewe’s international Distributor network.
Knewe’s product now has been developed well past the preliminary trial stage, and the product is being sold and used in the field by end users, in the dairy, beef, deer and equine sectors. This includes use by one of New Zealand’s largest agribusinesses that has been working with Knewe specifically to test the ability of Knewe® products to reduce the amount of nitrogen the dairy cow excretes to the environment, relative to production. On completion of these investigations, this company will move to establish an exclusive distribution arrangement for New Zealand and may look to take up a position giving them access to global product sales.
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