Arecor Therapeutics PLC (AIM:AREC) has unveiled acquisition plans designed to accelerate its commercial aspirations.
The bid for Tetris Pharma will be funded via a £6mln issue of stock at £3 a share, a modest discount to Friday’s closing price.
Tetris has developed and launched an injectable product called Ogluo for people at risk of severe hypoglycaemia that would sit alongside Arecor’s own fledgling treatments for diabetes.
"The board of Arecor believe that the acquisition of Tetris Pharma is a compelling opportunity to accelerate Arecor's commercially-driven strategy alongside our core diabetes and partnered products businesses,” said the company’s chief executive Sarah Howell.
“We will gain an existing, revenue-generating, sales, marketing and distribution platform which we believe is highly complementary to our existing speciality hospitals products business and has significant growth potential.”
The nuts and bolts of the deal are as follows: Arecor is handing over 651,726 shares worth just over £2mln at Friday’s close. The group will also settle £2mln of Tetris’ "liabilities", while there will also be £4mln of performance-based deferred payments.
In the first six months of this year, Tetris generated revenues of £600,000, though Arecor believes there is scope for significant future growth with the business expected to break even in the next three years.