Irvine-based Bio Essence Corp. is a Chinese herbal company with big dreams.
The 13-employee company, which makes a variety of herbal health, diet, and nutrition products, filed a registration statement late last month with the Securities and Exchange Commission for the potential selling of a little more than $38 million in stock.
Only $5 million of the offering would go back to the company; existing shareholders would sell the rest.
A Palos Verdes resident, Jian Yang, obtained controlling interest in the company in 2016; the prospectus didn’t list the owner’s background.
The Spectrum-area company’s stock would trade on an over-the-counter exchange, but a proposed ticker was undisclosed in the registrations statement, which said the company has yet to select an underwriter for the proposed initial public offering.
A word of warning was spelled out in the SEC filing: the offering will be “highly speculative in nature, involve a high degree of risk, and [is] suitable only for persons who can afford to risk the loss of the entire amount invested.”
TCM Focus
Bio Essence has three units: Herbal Essential develops traditional Chinese medicines, often known as “TCM,” in the form of single herbs and tablet; Fusion Naturals is focusing on mass market sales of its beauty supplements such as collagen products, and BE Pharma sells original equipment manufacturing and private label services to other companies.
The company sells its products through channels such as TCM practitioners; online websites such as Amazon, its own proprietary website, and brick-and-mortar stores such as GNC, Vitamin World, T.J.Maxx, HomeGoods, Marshalls, and Grocery Outlets.
“Our company strives to utilize the traditional Chinese medicine idea, take Eastern herbs with Western science combination approach,” the company said on its website.
The company posted a net loss of $1.5 million and $1.8 million the prior two years; Bio Essence has a $4.4 million accumulated deficit.
It made nearly $1 million in sales last year and is aiming for $2.5 million in sales this year, but thinks it can boost sales to $40 million in the next five years if it goes public.
The U.S. vitamin and dietary supplement market will grow by 53% to $28.7 billion by 2021, the prospectus said, citing Euromonitor International.
