Acrometa Group 43F 5.26%   has entered into a legally binding letter of intent (LOI) to purchase an additional 40% stake in Life Sciences Incubator Pte Ltd (LSI) for a total consideration of $1.6 million. The sum will be payable in tranches based on the realisation of agreed milestones. Some of the milestones include the completion of the proposed acquisition, the setting up of another site in Australia, and so on.

 

Upon the completion of the purchase, the group will own 70% of LSI, up from 30% previously.

 

LSI currently operates a 6,500 sq ft co-working laboratory space at The German Centre serving small- and medium-sized enterprises (SMEs) and start-ups. It was launched in September 2021 and now garners &ldquo very healthy occupancy rates&rdquo within a year of operations.

 

The consideration was said to factor in the expected future performance of the current site at The German Centre Singapore despite LSI&rsquo s loss before tax of $17,000 for the FY2022 ended Dec 31, 2022. LSI has also recorded a cumulative loss of $312,000 since it commenced operations in September 2021.

 

According to the group, LSI is expected to be ebitda positive in the FY2023 ending Dec 31, 2023, based on its current occupancy rates.

 

The co-working laboratory space business is said to have strong growth potential in Singapore as the country pivots its economy towards high-value sectors with more and more companies conducting research & development activities.

 

In addition, there is significant interest in the medtech, biotech and foodtech space with many start-ups and companies looking for laboratory spaces to conduct their research and development, says Acrometa.

 

&ldquo Driven by high cost of setting up such laboratories and the lack of independent laboratory locations, the company believes that there is growing demand for such co-working laboratory spaces,&rdquo it adds.

 

Acrometa&rsquo s executive chairman Levin Lee says the move &ldquo potentially carves out a new promising mainstream business for us as controlled environment specialist&rdquo .

 

&ldquo I am glad that Acrometa, through LSI, can play a vital role in supporting the research and development (R& D) of startups and SMEs, where their innovation and new discoveries will make the world a better place for us to live in. Our co-working laboratory spaces will make it easier for their dreams to come true.&rdquo

 

Expanding on the group&rsquo s plans, Lee says the group has &ldquo strategised Australia as our first foray overseas for LSI and we are excited to be there, where we believe there is a sizeable market to capture for the co-working lab space business! We have found a suitable location and on grounds of confidentiality, we are in talks with a renowned global government-linked company who has in principle agreed, subject to a binding agreement, to be one of the anchor tenants for the proposed LSI Australia site&rdquo .

 

&ldquo Our wholly owned subsidiary Acromec Engineers, with its experience as builders of cutting-edge laboratories will continue to support LSI&rsquo s expansion with its controlled environments engineering expertise in Singapore and the region,&rdquo says Lim Say Chin, CEO of the group.