28th Jan 2022 10:27
(Alliance News) - Oxford BioMedica PLC said on Friday that it has agreed to acquire majority ownership of a newly formed business in the US focused on adeno-associated viruses which are known infect humans and other primates.
The Oxford-based gene and cell therapy company said it has entered into an agreement with Massachusetts-based genetic medicines company Homology Medicines Inc to acquire an 80% ownership interest in the newly formed Oxford Biomedica Solutions LLC for USD175 million.
Homology will hold the remaining 20% ownership.
Oxford Biomedica will acquire the ownership interest through a USD130 million cash payment to Homology and a USD50 million capital injection into Oxford Biomedica Solutions to fund its growth.
Oxford Biomedica said the acquisition will broaden its viral vector offerings, expand its geographic presence and will be immediately accretive to revenue growth.
Oxford Biomedica Solutions will offer a scalable manufacturing platform to customers, including Homology through a multi-year supply agreement as a preferred customer. The agreement will have minimum contracted revenue of approximately USD25 million for the first twelve months.
The business will focus on adeno-associated viruses which are not currently known to cause disease but have several features that make them attractive candidates for creating viral vectors for gene therapy and human disease models.
Oxford Biomedica added that it will raise total gross proceeds of GBP80 million through a placing 4.9 million shares. The net proceeds will fund the company's existing capital requirements, cover the expenses of the transaction and provide additional working capital for the group.
The company said has also entered into a commitment letter for a secured short term loan facility of USD85 million which, if drawn down, is repayable in twelve months after completion of the transaction.
Shares in Oxford BioMedica were down 6.8% at 839.00 pence on Friday morning in London.
By Heather Rydings; [email protected]
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