Asterand has signed an agreement to acquire BioSeek, subject to Asterand shareholders’ approval. The company said that a circular will be sent to shareholders once it has been approved by the UK listing authority and a further announcement will be made in regard to this in due course.
The proposed acquisition of BioSeek will be Asterand’s first step in this ‘buy and build’ strategy. The Board believes that BioSeek is highly complementary to Asterand’s business in terms of both products and services offered.
Accordingly, the initial consideration will be $1.0m payable by the issuance of Asterand shares. A further payment of up to $13m will be payable in 2011 depending on the level of sales growth achieved by BioSeek in the twelve months ended 31 December 2010.
If any such further payment is made, the first $3.0m of such payment will be paid in Asterand shares, and any additional payment will be paid in either cash or shares, at Asterand’s discretion.
Asterand intends to maintain the South San Francisco site and staff. BioSeek’s key managers, including Dr Ellen Berg, BioSeek’s chief scientific officer and Dr Ivan Plavec, vice president of business development, will be joining Asterand’s senior management team. In addition, BioSeek’s CEO Dr Mike Venuti has agreed to act as a consultant to Asterand for a transition period following completion.
Martyn Coombs, chief executive officer of Asterand, said: “BioSeek has technology that is difficult to replicate, and can offer real added-value services to customers. The combination of this platform with Asterand’s exceptional sales and marketing team will propel performance for the product line to a new level. We anticipate that the proposed acquisition will be marginally loss-making or break-even in the first year of our ownership and will increasingly contribute to earnings thereafter.
“This acquisition is all about growth and value and offering the supply of more services to our customers to be seen by Pharma R&D as the human-based solutions company. In addition to investments in sales and marketing, in the future we will look carefully at potential investments in R&D to expand the BioSeek platform to a broader range of diseases. I look forward to working closely with the BioSeek team to expand and grow our combined business.”
Michael Venuti, chief executive officer of BioSeek, said: “We are pleased to join Asterand in its mission to provide value added human based solutions to pharmaceutical and biotechnology companies worldwide. This is an exciting milestone for our shareholders and staff.
“With the increasing use of cell based technologies in drug candidate evaluation, we believe the BioMAP platform is poised for growth. In addition, there are significant synergies to be realised in the complementary combination of the two companies’ scientific expertise, commercial operations, product platforms and customer base. We look forward to working with Asterand’s management team to ensure a rapid and seamless integration.”