You are leaving our website

or Decline

Proposed Acquisition of the Healthcare Products Business from Sinclair IS Pharma plc


("Alliance" or the "Group")

The Board of Alliance Pharma plc ("Alliance" or the "Company"), the specialty pharmaceutical company, today announces that it has entered into a conditional agreement with Sinclair IS Pharma plc ("Sinclair") to acquire certain assets and businesses principally focused on dermatology (the "Healthcare Products Business") for a consideration of £127.5 million, plus an estimated £4.7 million for inventory, to be satisfied partly in cash, funded by way of the New Loans, and partly by the issue and allotment of the Vendor Consideration Shares pursuant to the terms of the Acquisition Agreement.

The Acquisition constitutes a reverse takeover under the AIM Rules and, therefore, Completion is conditional on, amongst other things, receiving the approval of Shareholders. This approval will be sought at the General Meeting to be held at the offices of Fasken Martineau LLP, 17 Hanover Square, London W1S 1HU at 10.00 a.m. on 14 December 2015. Completion and Re-admission are expected to take place on 17 December 2015.

A combined Admission Document and Circular is being sent to the Company's shareholders today and will be available on the Investor Relations section of the Company's website at

Transaction highlights:

  • Alliance to acquire 27 products including five key growth brands (Kelo-Cote™, Flammacerium™, Aloclair™, Kelo-stretch™ and Atopiclair™). The acquisition of these complementary assets will materially increase the scale of the business.
  • The Acquisition will significantly increase the Company's footprint outside of the UK and will provide an enhanced platform for further corporate development.
  • In the 12 months ended 30 June 2015, the Healthcare Products Business generated revenues of £43.3 million and EBITDA before exceptional items of £9.0 million. It is estimated that cost-saving synergies of approximately £5.0 million will be achievable from the 12 months ending 31 December 2016.
  • The Directors believe that, taking into account the business and prospects of the Enlarged Group, the Acquisition will be significantly accretive to earnings per share on an adjusted basis for the 12 months ending 31 December 2016.
  • The Directors further believe that the return on invested capital associated with the Acquisition will exceed the Group's weighted average cost of capital in the 12 months ending 31 December 2017 (assuming a weighted average cost of capital of eight per cent.).
  • The Acquisition and associated expenses will be financed by a fully underwritten vendor placing raising gross proceeds of £78.5 million and by £54.2 million to be drawn down under the New Loans.
  • The proposed vendor placing will comprise the issue of 191,463,414 new Ordinary Shares at a price of 41 pence per share, a discount of approximately 19.6 per cent. to the closing mid-market price of 51 pence per ordinary share on 25 November 2015.
  • Irrevocable undertakings to vote in favour of the Resolutions have been received from the Directors and certain Shareholders in respect of 123,484,458 Ordinary Shares, in aggregate, representing approximately 46.7 per cent. of the Existing Issued Share Capital.
  • The Company has also granted the Option to Numis under the Placing Agreement in order to enable Numis to deal with additional demand under the Placing in the event that requests to participate in the Placing from institutional and certain other investors are received during the period from the date of this announcement to 5.00 p.m. on 2 December 2015. Any Ordinary Shares issued pursuant to the exercise of the option will be issued on the same terms and conditions as the Vendor Consideration Shares. The maximum number of new Ordinary Shares that may be issued pursuant to the exercise of options is 12,195,121.

“This Acquisition represents a very significant development for Alliance. On completion, Alliance will be a significantly larger business with synergies in existing markets. Having over half of our business outside of the UK, we will have a greater ability to compete for international deals and in-licensing opportunities.”

John Dawson, Chief Executive of Alliance
Swipe to see more
Expected timetable of principal events
Announcement of the Placing and Acquisition26 November 2015
Publication date of the Admission Document26 November 2015
Latest time and date for receipt of Forms of Proxy in respect of the General Meeting10.00 a.m. on 12 December 2015
General Meeting10.00 a.m. on 14 December 2015
Expected date and time of suspension of trading of the Ordinary Shares on AIM4.30 p.m. on 16 December 2015
Expected date of completion of the Acquisition8.00 a.m. on 17 December 2015
Expected date and time of Re-admission becoming effective and dealings in the Ordinary Shares commencing on AIM8.00 a.m. on 17 December 2015
Swipe to see more
Swipe to see more

Re-admission and Placing statistics
Existing Issued Share Capital264,520,610 Ordinary Shares
Number of Vendor Consideration Shares proposed to be issued191,463,414
Maximum number of Option Shares to be issued pursuant to the Option12,195,121
Placing Price41 pence per Ordinary Share
Enlarged Issued Share Capital (assuming no Option Shares are issued)455,984,024 Ordinary Shares
Enlarged Issued Share Capital (assuming the maximum number of Option Shares are issued)468,179,145 Ordinary Shares
Gross value of the Vendor Consideration Shares at the Placing Price£78.5 million
Gross value of the Option Shares at the Placing Price (assuming the maximum number of Option Shares are issued)£5.0 million
Market capitalisation of the Enlarged Group at the Placing Price immediately following Re-admission (assuming no Option Shares are issued)£187.0 million
Market capitalisation of the Enlarged Group at the Placing Price immediately following Re-admission (assuming the maximum number of Option Shares are issued)£192.0 million
Swipe to see more

For further information:

Alliance Pharma plc + 44 (0)1249 466966
Peter Butterfield, Chief Executive Officer
Andrew Franklin, Chief Financial Officer

Buchanan + 44 (0)20 7466 5000
Mark Court / Sophie Wills / Hannah Ratcliff

Numis Securities Limited + 44 (0)20 7260 1000
Nominated Adviser: Michael Meade / Freddie Barnfield
Corporate Broking: James Black

Investec Bank plc + 44 (0)20 7597 5970
Corporate Finance: Daniel Adams / Ed Thomas
Corporate Broking: Patrick Robb / Tejas Padalkar

Full RNS Announcement

Proposed Acquisition & Share Placing (PDF 1.2MB)