Sheep collagen maker Holista buys CEO's company for $1; shares rise 35pc

A $1 purchase has sent Holista CollTech shares up 35 per cent today.

Holista (ASX:HCT) paid $1 for a 47 per cent stake in iGalen International — the company it outsources product marketing to, sending its shares to 13c in early Thursday trade.

The shares closed up 20 per cent at 11.5c

The stake was sold by its own CEO, Dr Rajen Manicka.

“My other board member and I set up iGalen as a private venture as there are too many unknowns in an early stage network marketing company,” said Dr Manicka.

“Now that we are up and running with all the risks significantly reduced, I am pleased to offer my entire shareholding in iGalen to Holista for a token amount.”

Based in San Diego, iGalen has a network of 11,770 distributors and has binding agreements with Holista to buy raw collagen to make its own branded drinks range.

Holista is making halal sheep collagen for the food supplement market – it’s spending $1 million on a Western Australian factory to do this because sheep do not have the religious and cultural overtones that pigs and cattle do.

It’s a self-described “health style” company, but in its latest update says it is also launching a new product – a “stem cell releaser” – in October.

The idea being that when someone drinks or applies it, it stimulates stem cell growth. A company spokeswoman said it was not related to the sheep collagen product.

Holista already makes two tonnes of cosmetic-grade collagen a month.