Atomo times first share offer to perfection

Atomo times first share offer to perfection

Agribusiness
Four diagnostic companies are already considering using Atomo devices for rapid COVID-19 tests. Photo by Shutterstock.

Four diagnostic companies are already considering using Atomo devices for rapid COVID-19 tests. Photo by Shutterstock.

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Four diagnostic companies are already considering using Atomo devices for rapid COVID-19 tests.

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In the stock market, timing is everything and through no fault of its own, Sea Farms' timing has been terrible.

Atomo Diagnostics' timing, by sheer luck, may prove to be brilliant.

Sea Farms, (ASX code SFG) is trying to raise $12.5m in total to fund the next step of its ambitious Sea Dragon project.

It has offered rich and well connected investors SFG shares at a mere 3c each - half the price the shares were a month ago.

But with the market falling through the floor, the initial offer closed last week after raising only $6.9m instead of $12.1m.

Taking a very deep breath, the Punter has bought 50,000 SFG shares.

After all, Sea Dragon hopes to see first sales in the second quarter of 2022 and output growing from an initial 6000 to 7000 tonnes a year to 150,000 tonnes when the whole project is operational.

SFG's biggest shareholder and customer, the Japanese Mitsui group, has so far pumped in $28m.

The Punter can't see them writing that off lightly and foregoing a major source of supply.

Meanwhile, Atomo, which supplies rapid blood testing kits to detect infectious diseases, is launching its initial public offer of shares in the middle of a pandemic. Nice timing, guys.

Under the ASX code AT1, it is seeking $30m to fund expansion, including a rapid switch to focus on the coronavirus. The offer of shares at 20c closes on April 6.

Sales rose from $287,000 in 2018 to $937,000 in the latest six months.

Full year losses in 2018 and 2019 were $4.98m and $4.8m, with a loss of just over $2m in the latest six months.

The company depends heavily on the security of its patents, and no doubt many other companies are rushing to develop rapid test kits for COVID-19. Nevertheless, the Punter has applied for 10,000 AT1.

  • The Punter has no financial qualifications and no links to the financial services industry. He owns shares in a number of companies featured in this column.
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