Reyphon is seeking to raise about $26.4 million in net proceeds, through the sale of 78.6 million shares at $0.39 each. The offer comprises 2 million public shares and 76.8 million placement shares.

It produces gibberellic acids - a plant growth regulator that improves yields for crops like rice, fruits and vegetables. Gibberellic acids are naturally found in plants, and help to improve plant health - they are thus fundamentally different to chemically synthesised fertilisers, which seek to replenish the nutrients in the soil.

Li Jian Ke, an executive director at Reyphon who is also Sinomem's CTO, said Reyphon uses biological processes to ferment corn starch or other organic raw materials to produce the acids GA3, GA4 and GA7.

Over-use of fertilisers has led to environmental disasters in China, such as the widely reported algae bloom in Lake Tai at Wuxi earlier this year, said Lan Weiguang, non-executive chairman of Reyphon and chairman of Sinomem. Reyphon's products do not cause these problems, as they are expensive and sparingly used, and are better absorbed by plants, Dr Li said.

The subsidiary of Sinomem Technology is seeking its own listing. eyphon said that listing proceeds would be used to expand capacity, fund R&D, strengthen its sales network, and as working capital. There is no minimum amount which Reyphon seeks to raise. The company's pre-listing issued and paid-up share capital is $5.9m in 240m shares.

Reyphon is located in Xin'gan County, Jiangxi Province. It uses fermentation biotechnology to make gibberellic acids - which regulate plant growth - and validamycin, a plant antibiotic. With an annual gibberellic acid production capacity of 101 tonnes, it is one of China's largest producers.

Reyphon's revenue for FY06 was RMB145.3m, from RMB100.6m the year before. Profit after tax was RMB42.3m, up from RMB19.8m.