30th Sep 2014 08:56
LONDON (Alliance News) - Consort Medical PLC said Tuesday that it has agreed to acquire European pharmaceutical contract development and manufacturing organisation Aesica Holdco Ltd for GBP230.0 million.
Consort will fund the acquisition via a combination of GBP10.0 million in existing cash, GBP115.9 million to be drawn down under a new debt facility, the issue of GBP11.8 million consideration shares to the Aesica management, and a rights issue to raise GBP95.3 million.
The rights issue is being fully underwritten by Investec, and will consist of the issue of 5 rights issue shares for every 8 existing shares at 540 pence per rights issue share. This represents a discount of around 34% to the theoretical ex-rights price of 816.92 pence per rights issue share, Consort said.
Shares in Consort are trading down 2.0% at 970.00 pence Tuesday morning.
Aesica posted adjusted earnings before interest, tax, depreciation and amortisation of GBP20.0 million on revenue of GBP179.0 million in 2013.
Consort said it believes the acquisition "represents an excellent opportunity" which will add to underlying earnings per share in the first full financial year after completion, and in subsequent years. It expects the enlarged group to generate free cash flow, and expects to pay shareholders dividends with cover in the range of 2 to 3 times adjusted earnings per share reflecting the enlarged group's performance.
The company has entered into a new GBP160 million revolving financing facility, with an option for an additional GBP65 million, with a group of four banks. This facility is conditional on the rights issue completing, and the acquisition clearing.
The acquisition is subject to shareholder approval.
"We are excited by the acquisition of Aesica which represents a very strong fit with our existing strategy of diversifying into adjacent markets and technologies to capture additional value in the drug/device supply chain," said Chief Executive Officer Jon Glenn in a statement.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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