In a strategic move to expand its footprint in laboratory testing services, Advanced Enzymes USA (AEU) has announced the creation of a new entity named Starya Labs, Inc. This new corporation will be based in California and will primarily focus on enzyme and probiotic product testing. The decision comes as part of a reorganization involving Cal-India Foods International (SEB), a step-down subsidiary of AEU. Through this spin-off, SEB will transfer its existing enzyme and probiotic laboratory testing services, also known as SEB Lab, along with certain assets, intellectual property, and personnel, into Starya Labs.

The formation of Starya Labs will allow the company to consolidate its operations and focus more directly on the growth and innovation in the field of enzyme and probiotic testing. This new venture is set to be a wholly owned subsidiary of AEU and will, therefore, also be a step-down wholly owned subsidiary of Advanced Enzyme Technologies Limited (the parent company). As of now, the size and turnover of Starya Labs are not applicable as it is in the process of formation and not yet operational in terms of generating revenues.

In terms of financials, the value of assets being transferred by SEB to Starya Labs is capped at US $500,000, covering both tangible and intangible assets such as contracts, intellectual property, and personnel. However, this transaction does not fall under the category of a typical acquisition, as there are no third-party entities being involved in the deal—rather, it is an internal restructuring and the creation of a new corporate entity.

Notably, the move does not involve any change in ownership or control by the promoter group of the company, as the promoter group does not hold any direct interest in Starya Labs. Therefore, the transaction is considered to be at arm’s length. The move is aimed at improving the company's capabilities in the growing market for laboratory testing services related to enzymes and probiotics, which are essential for several industries, including pharmaceuticals, food processing, and health supplements.

Regarding regulatory approvals, the creation of Starya Labs will require compliance with California state regulations, including approval from the California Secretary of State, as is typically required for new corporations in the state. This step ensures the new entity operates in full compliance with local laws.

As of now, the anticipated completion timeline for this restructuring and operationalization of Starya Labs is set for March 31, 2025. This allows ample time for the transfer of assets and the establishment of the laboratory's testing services.

In terms of financial transaction structure, the entire process involves cash consideration, with a fixed value for the assets to be transferred. The new entity will not require a share swap, and there will be no change in shareholding patterns in Advanced Enzymes USA, as Starya Labs will remain a fully owned subsidiary.

The creation of Starya Labs signals Advanced Enzyme Technologies Limited’s continued focus on innovation and its commitment to expanding its laboratory testing capabilities, especially in the high-demand sectors of enzymes and probiotics. This is part of a broader strategy to streamline operations, enhance product offerings, and stay competitive in the global biotechnology and testing services markets.

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