Omega Diagnostics Group PLC (AIM:ODX) said it decided on a preferred bidder to acquire its CD4 business, after announcing nearly two months ago that the business was up for sale.
The medical diagnostics company focused on health and nutrition products said it signed a Head of Terms with the preferred bidder on 2 July.
CD4 is the part of the business which manufactures and supplies tests of VISITECT CD4, which measures the amount of CD4 protein in human cells.
According to a statement, the preferred bidder now has four weeks to complete its due diligence, with the transaction expected to be completed shortly after.
Upon completion, Omega will receive a “significant up-front cash payment” as well as a future royalty stream linked to VISITECT CD4 sales.
Omega said it believes the CD4 business will be more successful under new owners, which have a greater capacity to invest in production and product development, with Omega now solely focusing on its health and nutrition business.
“Having withdrawn from the COVID-19 market and disposed of the Alva site earlier this year, the divestment of our loss-making CD4 business will leave the group solely focused on our higher margin Health & Nutrition division,” said Jag Grewal, chief executive of Omega.