Subject to due diligence and a formal agreement, the proposed acquisition will take place by the end of the year.
Companies: Beximco Pharmaceuticals Limited Sponsored GDR RegS
Pharmaceutical manufacturing company Beximco (LON: BXP) shares have jumped this morning with the announcement it has signed a memorandum of understanding with Nuvista Pharma. BXP plans to acquire a majority stake of 85% in the company.
Subject to due diligence, negotiation, and completion of a definitive Sale and Purchase Agreement, the deal will complete by the end of December.
Shares in BXP were up 5% to 62p today off the back of the announcement.
Group MD Nazmul Hassan, commented:
"We believe that this Proposed Acquisition, whilst relatively small compared to Beximco Pharma, will serve as a strong foundation for sustainable growth in the future as well as being the first in our Company's history. In our view, Nuvista is a good strategic fit for Beximco Pharma as their strong position in hormones and steroids, with a unique portfolio of 50 generics, complements our existing product range."
Prior to today's share price jump, Beximco had a market of £239m and a PE ratio of 12x versus the industry median of 14x. Shares began to spike in 2016 from a price of c. 23p to a high of 67p in July this year.
In the five years to 2016, the Group enjoyed average Revenue and Net Profit CAGRs of 25% and 23% respectively. It also had an operating margin of 23% in the same five years.
