Venture Life Group (AIM:VLG) shares climbed 18% in early trading on Monday after the company agreed to sell its contract manufacturing operations and certain peripheral products for €62 million in cash.
The deal, with Italian firm BioDue, marks a shift in strategy for the UK-based healthcare group, which says it is moving away from capital-intensive manufacturing to focus on its higher-margin consumer brands.
The disposal includes Biokosmes and Venture Life Manufacturing AB, and is expected to be completed in the third quarter, subject to regulatory approval. The proceeds will be used to strengthen the balance sheet, pay down debt, and fund acquisitions in the UK, US and EU.
Venture Life will retain its core Power Brands, including Balance Activ, Health & Her, and Gelclair, and remain the largest customer of the sold operations under a new 10-year supply agreement.
The stock rose 8p to 53p.