BIOTROPICS MALAYSIA BERHAD
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AKARALI ENTERPRISE
M&A Scenario Analysis — 100% Acquisition Simulation
CONFIDENTIAL · DISCUSSION DRAFT
What if Biotropics Malaysia Berhad acquires AKARALI Enterprise (100%)?
This dashboard models the financial impact of a full vertical integration — combining Biotropics’ upstream B2B ingredient manufacturing with AKARALI’s downstream DTC consumer brand — across standalone performance, merger synergies, combined valuation, and pro forma financial projections.
RM 29.0M
Combined Revenue (FY2026E)
RM 11.4M
Combined PAT (FY2026E)
RM 121.4M
Combined EV (Base Case)
+71.8%
PAT Accretion (Base Case)
RM 3.5M/yr
Annual Synergies
RM 41.7M
AKARALI Acquisition Price (Base)
Business split: Biotropics’ revenue is 90% B2B (Physta® extract powder to OEM/distributors including AKARALI) and 10% B2C (Nu-Prep consumer brand + direct sales). ·
AKARALI intercompany: AKARALI purchases RM 1.48M/year of extract from Biotropics (eliminated in consolidation). ·
DTA benefit: Biotropics holds RM 255.5M in accumulated losses → deferred tax asset → near-zero effective tax rate for years; post-merger, AKARALI’s 24% tax obligation is absorbed. ·
Biotropics FY2025E: Assumed flat at ~RM 23.5M (FY2025 accounts not yet filed as at Jun 2026). ·
FY2022 revenue: Shown as RM 0 per SSM filing — likely a filing/consolidation anomaly; PBT of RM 5.95M confirms business was operational. ·
Merger timing: Effective start of FY2027 for pro forma modelling. ·
Biotropics EBITDA: Estimated as PBT + RM 800K D&A = RM 7.52M (no interest expense; debt-free). ·
USD conversion: RM 4.10/USD. ·
Auditor: Ernst & Young PLT (unqualified opinion, all 5 years). ·
Source: SSM e-Info, AKARALI Enterprise cost ledger Jan–May 2026, Biotropics production records.
Entity Overviews — Standalone
Acquirer — Upstream / B2B
Biotropics Malaysia Berhad
Reg. No. 200701004244 (762243-P) · Incorporated 09-Feb-2007 · Shah Alam, Selangor
Research, development, marketing & sales of Malaysian biodiversity-based products
RM 24.8M
Net Assets (Book)
Target — Downstream / DTC B2C
AKARALI Enterprise
Petaling Jaya, Selangor · Premium Tongkat Ali supplement brand
DTC e-commerce across US, UK, AU, SG, MY — 5 active markets
RM 5.94M
Annualized Revenue (2026E)
RM 2.75M
EBITDA (annualized)
Biotropics Malaysia Berhad — 5-Year Financial Performance (Source: SSM e-Info, Ernst & Young PLT)
Revenue & Profit After Tax — FY2020 to FY2024 (RM ‘000)
Profit After Tax (RM ‘000)
† FY2022 revenue not disclosed per SSM filing
FY2024 net margin: 28.2% · Auditor: Ernst & Young PLT · Unqualified opinion all 5 years · Revenue CAGR (FY20–24): 10.5%
Revenue Composition — FY2024 (Estimated)
B2B Segment (90%)Physta® extract powder to OEM, distributors, brand owners
RM 21.2M
B2C Segment (10%)Nu-Prep consumer brand + AKARALI-related direct
RM 2.4M
Note: AKARALI is estimated to contribute ~RM 1.48M to Biotropics’ B2B revenue as a paying customer. Post-merger, this becomes intercompany and is eliminated in consolidation.
FY2024 Revenue
RM 23.6M
−5.6% vs FY2023
SSM confirmed
FY2024 PAT
RM 6.64M
28.2% net margin
E&Y Unqualified
Net Assets
RM 24.8M
Debt-free, CR 5.42×
Strong liquidity
Est. EBITDA
RM 7.52M
31.9% margin
PBT + D&A est.
Deferred Tax Asset
RM 255M+
Accumulated losses
Near-zero eff. tax
Pre-Merger Comparison — Biotropics vs AKARALI
Key Metrics Side-by-Side
| Metric |
Biotropics |
AKARALI |
Edge |
| Annual Revenue | RM 23.6M | RM 5.94M | BIO 4× |
| Net / EBITDA Margin | 28.2% (net) | 46.2% (EBITDA) | AKA margin |
| Revenue Growth (CAGR) | 10.5% | 42.0% | AKA 4× faster |
| Effective Tax Rate | ~1.2% (DTA) | 24% (std. corp) | BIO advantage |
| Business Model | B2B Manufacturer | B2C DTC Brand | Complementary |
| Current Ratio | 5.42× | N/A (private) | BIO cash-rich |
| Debt Position | Debt-free | Minimal | Both clean |
| Active Markets | Export (OEM) | 5 (DTC) | AKA footprint |
| Auditor / Governance | Ernst & Young | Internal | BIO governance |
| R&D / Clinical | 7+ peer-reviewed RCTs | Leverages Biotropics | BIO depth |
Revenue & Margin Visual Comparison
Vertical integration rationale: Biotropics = upstream ingredient (B2B) · AKARALI = downstream brand (DTC B2C). Combined = fully integrated from extract cultivation → consumer capsule → global doorstep. AKARALI’s high margin and hypergrowth velocity injects a new growth engine into Biotropics’ more mature, lower-growth B2B business.
Merger Synergy Analysis — Identified & Quantified
Annual Synergy Sources (MYR)
1 · Marketing Cost Sharing (Nu-Prep ↔ AKARALI)
Biotropics spends RM 1–2M/yr on Nu-Prep downstream marketing. Post-merger, AKARALI’s 5-market DTC infrastructure (website, email, Amazon, social) absorbs this function — eliminating the standalone external spend. Base: RM 1.5M saving.
RM 1,500K
2 · Tax Optimisation (DTA Utilisation)
AKARALI’s RM 659K annual tax liability absorbed by Biotropics’ RM 255M+ accumulated losses DTA
RM 659K
3 · Nu-Prep via AKARALI DTC Channels
Biotropics’ Nu-Prep consumer brand gains access to AKARALI’s 5-market DTC infrastructure (US, UK, AU, SG, MY)
RM 500K
4 · Transfer Price Improvement
Extract transferred at production cost (not arm’s length price) → AKARALI COGS reduces by RM 414K/year vs external pricing
RM 414K
5 · Shared R&D / Clinical Costs
Single clinical validation programme covers both entities; no duplication of regulatory filing costs
RM 300K
6 · Working Capital Efficiency
AKARALI inventory held on Biotropics’ balance sheet; elimination of external trade credit cycle
RM 150K
Total Annual Synergies
RM 3.52M/yr
Capitalised @ 7.5× (PV ~5yr, 18% discount)
≈ RM 26.4M
Synergy Value Breakdown (RM)
Largest synergy: Marketing cost sharing (RM 1.5M/year) — Biotropics currently spends RM 1–2M annually on Nu-Prep downstream marketing through external agencies and campaigns. Post-merger, AKARALI’s established DTC infrastructure (US/UK/AU Amazon stores, email lists, SEO content, social channels) absorbs this function at near-zero incremental cost, eliminating the standalone spend entirely. The DTA tax optimisation (RM 659K/year) is the second-largest synergy, requiring zero integration effort.
Pro Forma Combined Financials — FY2026E to FY2028E (Base Case)
FY2026E (Year of Merger)
RM 29.0M
Combined Revenue (incl. intercompany elimination RM 1.48M)
Biotropics RevenueRM 23.5M
+ AKARALI RevenueRM 6.98M
− IC Elimination−RM 1.48M
Net Combined RevenueRM 29.0M
Combined PATRM 11.40M
Net PAT Margin39.3%
FY2027E (+1 Year Post-Merger)
RM 32.1M
AKARALI grows 35% · Biotropics grows 5%
Biotropics RevenueRM 24.7M
+ AKARALI RevenueRM 9.42M
− IC Elimination−RM 2.0M
Net Combined RevenueRM 32.1M
Combined PATRM 12.66M
Net PAT Margin39.4%
FY2028E (+2 Years Post-Merger)
RM 35.5M
AKARALI grows 28% · Biotropics grows 5%
Biotropics RevenueRM 26.0M
+ AKARALI RevenueRM 12.1M
− IC Elimination−RM 2.6M
Net Combined RevenueRM 35.5M
Combined PATRM 14.09M
Net PAT Margin39.7%
Combined Revenue Trajectory — Before & After Merger (RM Millions)
Combined entity (post-merger)
† 2022 Biotropics revenue not disclosed per SSM filing
Valuation Analysis — Standalone → Combined
Biotropics Standalone Valuation (MYR)
| Method | Basis | Valuation |
|---|
| P/E Multiple | 12× PAT (RM 6.64M) | RM 79.7M |
| Revenue Multiple | 2.5× Rev (RM 23.56M) | RM 58.9M |
| EV/EBITDA | 9× Est. EBITDA (RM 7.52M) | RM 67.7M |
| Book Value (NAV) | Net assets | RM 24.8M |
| Blended Average | (P/E + Rev + EV/EBITDA) | RM 68.8M |
P/E benchmark: Bursa-listed supplement/herbal companies 10–14× · Revenue multiple for B2B ingredient manufacturer 2–3.5× · Strong DTA reduces discount rate applied by buyer
AKARALI Standalone Valuation (MYR)
| Method | Basis | Valuation |
|---|
| Revenue Multiple | 4.5× NTM Rev (RM 6.98M) | RM 31.4M |
| EBITDA Multiple | 12× EBITDA (RM 3.23M) | RM 38.7M |
| DCF (5-yr) | WACC 20%, TGR 5% | RM 35.8M |
| IP Portfolio | RfR + Market Comp (blended) | +RM 6.4M |
| Blended (incl. IP) | Ops avg + IP | RM 41.7M |
AKARALI benchmark: DTC supplement brands at 40%+ CAGR, 46% EBITDA margins · IP value additive · Recommended acquisition price: RM 35M–RM 53M range
⚠ Worst Case
RM 69.5M
Combined enterprise value
Biotropics EVRM 48.0M
+ AKARALI EVRM 18.5M
+ Synergies+RM 6.0M
− Integration cost−RM 3.0M
vs SOP (66.5M)+4.5%
≈ USD$17.0M
◉ Base Case
RM 121.4M
Combined enterprise value
Biotropics EVRM 68.7M
+ AKARALI EVRM 41.7M
+ Synergies+RM 13.0M
− Integration cost−RM 2.0M
vs SOP (110.4M)+10.0%
≈ USD$29.6M
★ Best Case
RM 177.5M
Combined enterprise value
Biotropics EVRM 95.0M
+ AKARALI EVRM 59.5M
+ Synergies+RM 24.0M
− Integration cost−RM 1.0M
vs SOP (154.5M)+14.9%
≈ USD$43.3M
Valuation Bridge — Biotropics Standalone → Combined Entity (Base Case, RM Millions)
Reading the bridge: Biotropics standalone (RM 68.8M) + AKARALI acquisition (RM 41.7M) = Sum-of-Parts (RM 110.5M) → add merger synergies (RM 13.0M, incl. RM 1.5M/yr marketing cost sharing) → less integration costs (RM 2.0M) = Combined EV RM 121.4M. The merger creates RM 11.0M of net new value above simple SOP addition — driven primarily by the new marketing cost synergy.
PAT Accretion Analysis — Impact on Biotropics’ Earnings
PAT Before vs After Acquisition (RM ‘000)
Biotropics standalone PAT
Synergy uplift (DTA + marketing saving)
Accretion Summary — Base Case
Pre-Acquisition (Biotropics standalone)
RM 6.64M
PAT FY2024 baseline
Post-Acquisition (Combined, FY2026E)
RM 11.40M
DTA tax synergy + AKARALI contribution + marketing saving
PAT Accretion
+RM 4.77M +71.8%
Highly accretive to Biotropics’ earnings base
PAT breakdown of +RM 4.77M uplift:
AKARALI EBITDA contribution: +RM 2.75M (no tax, DTA absorbs)
Marketing cost synergy (Nu-Prep saving): +RM 1.50M
AKARALI tax saving vs standalone: +RM 0.66M
Less: est. acquisition financing cost (if any): −RM 0.14M
Net accretion: +RM 4.77M (+71.8%)
Deal Structure Options — AKARALI Acquisition
Financing Scenarios for RM 41.7M Acquisition (Base Case Price)
| Structure | Cash | New Shares | Debt | Annual Interest | Net PAT Impact | Biotropics Capacity |
| Option A — Full Cash | RM 41.7M | — | — | — |
+RM 4.77M (pure) |
Biotropics curr. assets RM 17.1M; needs RM 24.6M external |
| Option B — Mixed (50/50) | RM 20.8M | RM 20.9M | — | — |
+RM 4.77M (diluted) |
Partial cash + new Biotropics equity; requires share valuation |
| Option C — Debt-Funded | RM 5M | — | RM 36.7M | RM 2.20M @ 6% |
+RM 2.57M (net of interest) |
Biotropics debt-free today; banks will likely lend against strong earnings |
| Option D — Share Swap | — | RM 41.7M | — | — |
+RM 4.77M (diluted per share) |
AKARALI shareholders receive Biotropics equity; simplest structure |
Recommended structure: Option B (50/50 mixed) or Option D (share swap) if AKARALI shareholders wish to retain upside in the combined entity. Option C (debt) is viable given Biotropics’ debt-free status and RM 17.1M current assets as collateral. Option A requires external capital raising given Biotropics’ current asset base.
Revenue CAGR — Before vs After Merger
Revenue CAGR Comparison — Standalone vs Combined Entity
Biotropics Standalone
10.5% CAGR
FY2020–2024 historical. Mature B2B ingredient business.
AKARALI Standalone
42.0% CAGR
FY2021–2025 confirmed. DTC hypergrowth, zero marketing spend.
Combined Entity (FY2026–28E)
~15–20% CAGR
Blended rate: AKARALI high growth offsets Biotropics maturity.
Industry Benchmark (Health Supplement)
3–12% CAGR
General health 3–8%, niche sports supplement 8–12%.