BioProspect buys trader to boost distribution prospects

Brisbane biopesticide developer BioProspect (ASX:BPO) has moved to establish itself as a significant player in the biotech business by acquiring agrochemical trader Tradewyns as a vehicle to distribute its products.

BioProspect said it expected Tradewyns to give the company an annual revenue stream of AUD$10 million in the first year of trading. BioProspect will use the profits to expand its biological pesticide research and discovery programs.

Tradewyns will supply more than 30 products to the agricultural, biotechnology, environmental and animal-health sectors.

BioProspect CEO Selwyn Snell said the deal gave his company a foothold in Australia's lucrative $1.4 billion agrochemical trade.

BioProspect has appointed two new senior executives to Tradewyns -- Warwick Dowse, former general manager of Griffin Australia and New Zealand becomes business director, while Shane McManaway, former GM of agricultural products network IAMA Retail and former CEO of TruTest, has been appointed sales and marketing director.

Snell said Tradewyns would give BioProspect greater control over the commercialisation of its proprietary products, and a ready-made distribution network for promising compounds like its bioinsecticide Qcide, and termiticide AP 778, when they reach the market.

The company said the acquisition was conditional on BioProspect raising a minimum of $2 million from a share-purchase program underwritten by Cygnet Capital, which will fund the initial purchase of stock and provide working capital.

Irrespective of their holdings, all existing BioProspect shareholders will be eligible to purchase the shares, up to a maximum value of $5000, free of brokerage and commission, the company said.