Aroa Biosurgery has soared more than 80 per cent on its ASX debut as investors snapped up shares of the Kiwi sheep-gut biotech company.
Aroa shares were up 84.7 per cent to $1.385 at 11.30am, giving the 140-person company a market capitalisation of about $416 million.
The company raised $30m by selling 40m new shares at 75¢ apiece, with early investors selling another $15m worth of shares.
The company makes a soft tissue regeneration platform, Endoform, which is derived from sheep forestomach and is used as a scaffolding for wound healing.
“We knew after the roadshow that we had good institutional demand, we knew today would go well, but it’s been surprising how well it’s gone,” Aroa founder and chief executive Brian Ward said.
Trading began following a bell-ringing ceremony livestreamed between the ASX’s headquarters in Sydney and Aroa’s offices in Auckland, joined by happy investors and staff.
“It’s been quite a party,” Mr Ward said.
The company plans to use the funds from the IPO to expand in the US, where it has five commercial products approved for sale, targeting chronic wounds, hernia, soft tissue and breast reconstruction.
Its products have been used in more than four million procedures at 600 hospitals.
Aroa says that Endoform is 20 per cent to 60 per cent less expensive than competing biological regeneration products, while only slightly more expensive than synthetic scaffolding technology..
In FY2020 the company had product revenue of $NZ22m ($20.6m) and was earnings positive.