Stic Investments invests US$16.8M in Labgenomics via convertible bonds

What's the deal? South Korean genomics firm LabgenomicsDealroom has a profile for this one. Try Dealroom → saw its share price jump 11% in early trading on June 9 after news broke that Stic InvestmentsDealroom has a profile for this one. Try Dealroom → had invested US$16.8M (roughly $14M) in the company through convertible bonds.

Stic Litmus, a Stic Investments vehicle, acquired Labgenomics' fifth series of privately placed, unsecured convertible bonds. The CBs can be converted into 13.6 million ordinary shares at US$1.23 per share, giving Stic a potential 18.38% stake.

Why now? The investment was made through Stic's Credit Fund No. 1, a blind fund worth US$360.5M that was raised at the end of last year. The deal marks one of the fund's first publicly known mezzanine investments in a listed company, led by Stic's credit division.

Labgenomics, a gene-analysis company listed on Korea's KOSDAQ (ticker: 084650), was trading at US$0.83 per share as of 9:35 local time — up 11.24% from the previous close.

What could go wrong? The conversion price of US$1.23 sits well above the current trading price of US$0.83, meaning significant share price appreciation would be needed before conversion becomes attractive. If the stock fails to climb, dilution risk looms for existing shareholders without corresponding upside for the investor.

The signal: Stic Investments, classified by Dealroom as an investment fund, is deploying mezzanine capital into an early-growth molecular diagnostics company — a structure that offers downside protection through fixed income while preserving equity upside in a volatile sector. The deal is one of the first publicly known deployments from Stic's US$360.5M credit blind fund, suggesting the firm sees listed Korean genomics companies as an undervalued asset class worth backing with significant cheques despite subdued share prices.

Read more: edaily.co.kr