Sometimes a stock just needs the right catalyst. For Bio Green Med Solution (BGMS), that catalyst came Thursday evening in the form of a business combination with a Malaysian waste-to-energy company. Shares shot up 175.47% to $2.92 after the bell.
The clinical-stage biopharmaceutical company — yes, that's what it is now — announced an all-stock share exchange with Future NRG Sdn. Bhd., a medical waste-to-energy technology developer based in Malaysia. Under the deal, Future NRG will become a wholly owned subsidiary of BGMS.
Future NRG operates the Sendayan Ozone Medical Waste Treatment Plant in Negeri Sembilan, a facility that can process 10 metric tons of medical waste per day. Instead of burning the waste, it uses ozone gas technology. Ngu Wang Keat, Director of Future NRG, says the process delivers a "99.9999% reduction in microbial populations while eliminating the carbon emissions associated with traditional incineration." That's a lot of nines.
The transaction has been unanimously approved by both companies' boards and is expected to close in the fourth quarter. It still needs shareholder approval and SEC registration. Datuk Dr. Doris Wong Sing Ee, currently CEO and Executive Director of BGMS, will continue leading the combined company under the BGMS name on Nasdaq.
Before the announcement, BGMS was a tiny stock with a market capitalization of just $5.85 million. It had traded between a 52-week high of $25.95 and a low of $0.73. Over the past 12 months, the stock had dropped 88.31%. It was trading close to its 52-week low before the deal news broke.
The stock's Relative Strength Index (RSI) sits at 55.71, which is neutral territory — not overbought or oversold. According to market data, BGMS is experiencing long-term consolidation with short and medium-term upward movement.
On Thursday, the stock closed the regular session at $1.06. Then the after-hours fireworks began. Whether this deal transforms BGMS into a waste-to-energy play or just provides a temporary pop remains to be seen. But for one night, at least, the stock was anything but bio-green.
