SafetyMed seeks $2.2m life support

Safety Medical Products founder and former CEO John Riemelmoser and John Darley at the company's listing in 2005. Both are no longer involved with the management of the company after was placed in administration with too much debt. Picture: Sarah Reed Source: The Advertiser

The company is offering 220 million shares at 1c each on the proviso it raises a minimum $1.7 million.

At least $475,000 will be set aside to fund the recapitalisation and listing of the company, $200,000 for working capital and $1.025 million to assess its safety syringe technology  a process that could take up to 12 months.

The company's prospectus does not reveal forecasts for the technology.

"The directors ... believe that they do not have a reasonable basis to forecast future earnings on the basis that the operations of the company are inherently uncertain," it says.

"Accordingly, any forecast or financial projections would contain such a broad range of potential outcomes and possibilities that it is not possible to prepare a reliable best estimate forecast or projection."

The prospectus also explains that the company's failure was tied to its inability to compete against suppliers producing a wide range of retractable syringes rather than Satety Medical's sole 1mm syringe.

It will now focus on commercialising its existing technology and has retained former managing director John Riemelmoser as a technical consultant.

If successful, the company plans to relist on December 29.

It entered a trading halt at the start of March after it missed a reporting deadline. It later revealed a key financier, National Australia Bank, had balked at extending its debt among reports of disappointing sales for its feminine sanitary products.

Perth-based private equity firm Trident Capital successfully bid for the company in July  a rescue package that was formally approved and finalised by shareholders last week.

Former administrator Sam Davies, of McGrath Nicol, said the approval of the deed of company arrangement now allowed the company to focus on its core business rather than battling outstanding debts.

"We have created the trust to distribute funds to creditors," he said.

"We will now adjudicate on proofs and will discuss that with creditors. That has allowed us to hand the company over to its new owners."

The recapitalisation will also significantly dilute existing shareholdings, with a maximum 220 million new shares to bypass the existing 166.5 million.

The offer opens tomorrow and closes December 15.