The Dunedin-based biotech company Botry-Zen Ltd is up for sale.
BZ, formed in 2001, manufactures biological control agents for the agri/horticultural industries. Its lead product, also termed Botry-Zen, is a fungal spore preparation that inhibits the growth of the detrimental grape fungus Botrytis cinerea through niche competition. Its second product, Amour-Zen also targets Botrytis cinerea, but through a different mechanism. Its active ingredient, soluble chitosan exhibits anti-microbial activity and is used in combination with BZ. To date the products have shown strong results both on national and international vineyards.
Despite having a promising product and significant levels of investment (NZ$10 million over 7 years), recent production difficulties (to be specific substandard fermentation volumes for Botry-Zen and filtration issues for Armour-Zen) have impeded the companies ability to meet its forecasted production and cashflow targets, placing them in default with the BNZ. As an effort to save the company, a $1.8million capital raising proposal was sought after. However BZ shareholders have since rejected the proposal resulting in the company being place under sale.
BZ’s share price has lurked around 3 cent mark for most part of the year dropping further in August past 1 cent following these production difficulty announcements.
Some punter may get a good deal here: a biotech company with a product that works, hinged on international success once production is rectified.