3rd Feb 2006 07:00
Premier Research Group03 February 2006 For Immediate Release 3 February 2006 PREMIER RESEARCH GROUP PLC Placing of 4,444,444 New Ordinary Shares at 135p per share Notice of Extraordinary General Meeting Trading Update Premier Research continues to make strong progress in line with year end market expectations Premier Research Group plc ("Premier Research" or the "Company"), theinternational pharmaceutical services group today announces a placing to raise£6.0 million ("the placing") and a trading update on its financial performanceentering the close period in respect of its preliminary results for the yearended 31 January 2006. Key Highlights * Placing to raise £6.0 million * 4,444,444 new ordinary shares placed at 135p * Net funds to be used to: * Satisfy all outstanding deferred cash consideration from recent acquisitions; * fund additional working capital; * fund or part-fund further acquisitions without the need to raise further funds; and * facilitate the adoption of new consolidated and increased bank facilities * Year ended 31 January 2006 trading in line with market expectations * Strong current order book - book to bill ratio continues at greater than one * Buy and build strategy - 3 acquisitions in last 12 months * EPA and PharmData now been fully integrated * Integration of IMFORM, acquired in December 2005, continues, in line with management's expectations Commenting on the announcement, Dr Simon Yaxley, Chief Executive Officer ofPremier Research said: "We are delighted to have received support from our shareholders with regards tothe Placing. We have continued with strong trading going into the current year and havemaintained a book to bill ratio at greater than one, providing goodvisibility into 2007 and beyond. The order book is growing in the core and acquired businesses, and theintegration of the IMFORM acquisition is ahead of plan. We will continue tofocus on growing the business both organically and via acquisition. We look forward to providing further detail on this year's performance andfuture prospects at the time of our Preliminary Results in April." For further information, please call: PREMIER RESEARCH GROUP PLC Tel: 01344 458 311Dr Simon Yaxley, Chief ExecutiveEVOLUTION SECURITIES Tel: 020 7071 4300Matt WoodBUCHANAN COMMUNICATIONS Tel: 020 7466 5000Lisa Baderoon/Rebecca Skye Dietrich Notes to editors:About Premier Research Premier Research is a growing contract research organisation (CRO) involved inthe design and execution of clinical trials (Phases II-IV) on behalf ofpharmaceutical and biotechnology companies. Premier is established in threetherapeutic areas - oncology, CNS (central nervous system) and anti-infectives -with a strong underlying expertise in paediatrics. Through a focused approach toclinical management, the company has built a reputation with its customers fordelivery of its services, and has demonstrated organic growth following itsrecent acquisitions. Premier has also established itself as an activeparticipant in the consolidation activity within the sector. 1. Introduction and summary Premier Research is an international pharmaceutical services group, providingclinical trial management and informatics capabilities to the internationalpharmaceutical and biotechnology industries. Since the Company was admitted to trading on AIM in 2004, Premier Research hassuccessfully completed three acquisitions, two in Germany and one in the US.EPA, Euro Pharma Auftragsforscung GmbH ("EPA"), based in Frankfurt, Germany wasacquired in June 2005 and PharmData, Inc ("PharmData"), based near Atlanta, US,was acquired in July 2005. Both of these acquisitions have been fully integratedinto the Group and sales from both organisations are currently ahead ofpre-acquisition estimates. The third acquisition, of the business and assets of IMFORM GmbH ("IMFORM"),also based near Frankfurt, was completed in December 2005 and is currently inthe process of being integrated with the rest of the Group. With theseacquisitions, the Group has successfully broadened its reach into Eastern Europewhilst strengthening its existing operations throughout Europe and the US.Furthermore, the Company's admission to AIM in 2004 and the subsequentacquisitions have served to raise the general profile and status of PremierResearch to such an extent that it is now in a position to tender for largercontracts. The proceeds of the placing of the New Ordinary Shares of £6.0 million (beforeexpenses) will enable the Group to satisfy all of the outstanding deferred cashconsideration payable in respect of the acquisitions. In addition, the Directorsbelieve that the proceeds of the placing of the New Ordinary Shares, togetherwith new consolidated bank facilities currently being negotiated with PremierResearch's bankers, will enable the Company to continue to take advantage offurther in-fill acquisition opportunities. The key criteria of any acquisitionopportunity remains the expansion of the Group's global sales and deliveryreach, and the attainment of synergies in each of its technical focus,therapeutic focus and cost base. Areas of particular interest for such expansioninclude Scandinavia and the US. The placing of 4,444,444 New Ordinary Shares at a price of 135p per share (the"placing price") is conditional, inter alia, upon (i) the Company obtainingapproval from its shareholders to disapply pre-emption rights and to grant theBoard the necessary authority to allot New Ordinary Shares; and (ii) Admission.Resolutions regarding the Placing will be voted on at an Extraordinary GeneralMeeting to be held on 27 February 2006 (the "Resolutions"). The Placing has been fully underwritten by Evolution Securities Limited("Evolution Securities"). 2. The Placing and use of proceeds The proceeds of the placing of the New Ordinary Shares will: •allow the Company to satisfy the outstanding cash deferred consideration from the acquisitions of EPA and IMFORM; •potentially facilitate the adoption of new consolidated and increased bank facilities; •increase the Company's working capital, enabling the Company to tender for larger contracts; and •enable the Company to continue to make in-fill acquisitions as and when they might arise, without the need to raise further funds. The Placing is conditional upon, inter alia, the passing of the Resolutions andAdmission becoming effective. The 4,444,444 New Ordinary Shares to be issued will represent 8.4 per cent. ofthe enlarged issued share capital. The placing price of 135 pence represents adiscount of 4.9 per cent. to the closing middle market price of 142 pence perOrdinary Share at the close of business on 2 February 2006, being the lastbusiness date prior to the date of this document. Application will be made to the London Stock Exchange for the New OrdinaryShares to be admitted to trading on AIM. It is expected that Admission willoccur on 28 February 2006. 3. Current trading and prospects Since the release of the interim results for the six months ended 31 July 2005,the Group's trading has continued to be strong and management expect the Groupto report results for the year ended 31 January 2006 in line with marketexpectations. The Directors believe that the Group is well placed for furthergrowth in the current financial year, with the current book to bill ratioremaining greater than one. Since 31 July 2005, the Group has completed the acquisition of IMFORM, on 19December 2005, for a total consideration of up to €7.0 million, of which €2.0million was satisfied by an initial cash payment funded out of the Group'sexisting cash resources and an extension of the Group's borrowing facilities. Ofthe remaining €5.0 million consideration, approximately €2.2 million relates tothe repayment of billings in advance of an existing customer contract and up to€2.8 million will be payable dependent upon the financial performance of thebusiness and assets acquired in the period to 31 December 2006. The Company has received positive feedback from its customers following theacquisition of IMFORM and is pleased to report that since then, the Group hassecured over €2.0 million of new orders from the affiliate of IMFORM's largestcustomer and further firm letters of intent from new clients for contracts worthan additional €2.0 million. The pre-acquisition rationalisation plans for IMFORM remain on target and IMFORMis expected to be fully integrated into the Group by the end of February 2006. EPA and PharmData have now been fully integrated into the International and USorganisations respectively, with key individuals placed in key roles in theGroup. The Regulatory Affairs group within EPA has added significant value toproposals currently with clients, whilst continuing to generate salesopportunities as a standalone service provision. The data management processesacquired with PharmData have now been fully exported to the rest of the Group,providing both improvements in service offerings to clients and a significantcompetitive edge to the Group's sales force. The maximum deferred consideration for EPA and PharmData is £6.95 million, ofwhich up to £5.1 million would be satisfied by the issue of new Ordinary Shares,leaving a maximum of £1.85 million to be satisfied in cash. 4. Directors shareholdings At the time of the Company's admission to AIM in 2004, all the Directors enteredinto undertakings with Evolution Securities and the Company not to sell OrdinaryShares prior to the announcement of the preliminary results of the Company forthe year ending 31 January 2006. For a further year thereafter, the Directorsundertook to be bound by orderly market arrangements, whereby they would onlysell Ordinary Shares after consultation with, and through, Evolution Securities.The Company and Evolution Securities have today agreed to waive the provisionsof these undertakings so as to enable Dr. Simon Yaxley and Dr. Guy Patrick ("theSelling Directors") to sell a total of 1,833,334 Ordinary Shares ("Sale Shares")which will form part of the Placing. However, the Selling Directors have given a firm undertaking that, following thesale of the Sale Shares, they will not sell any further Ordinary Shares prior tothe date on which the Company's preliminary results for the year ending 31January 2007 are announced. At the time of the Company's flotation in 2004, the Selling Directors held anoption to acquire 1,833,334 Ordinary Shares ("Selling Directors' Option") at anexercise price of approximately 36p ("Exercise Price") from the Company's thenmajor shareholder, Henley Trustees Limited. The Selling Directors will, subjectto Admission and the closing middle market price per Ordinary Share on 31 March2006 being not less than the Exercise Price, immediately exercise the SellingDirectors' Option. Following the sale of the Sale Shares and the exercise of the Selling Directors'Option, the Selling Directors will each hold exactly the same number of OrdinaryShares as they currently hold, being 4,000,000 Ordinary Shares. Following theexercise of the Selling Directors' Option, Henley Trustees Limited will hold5,250,000 Ordinary Shares, representing approximately 10 per cent. of theEnlarged Issued Ordinary Share Capital . 5. Extraordinary General Meeting The circular to be sent to Shareholders today contains a notice convening an EGMto be held on 27 February 2006 at the Company's Registered office at 12 noon, atwhich the Resolutions will be proposed for the purposes of implementing thePlacing. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
PRG.L