Open Oprhan PLC (LON:ORPH) have announced their intentions to relist on the London AIM market in an announcement on Monday and also announced an undisclosed merger deal.
The firm said that the decision was made following its merger with clinical development services provider hVIVO PLC (LON:HVO).
Last week, Open Orphan said that the merger deal had been unconditional after the firm received total valid acceptance for 72.5 million shares, which amounted to 87% of hVIVO’s entire issued share capital.
Under the terms of the agreement, hVIVO shareholders will receive 2.47 new Open Orphan shares per hVIVO share. The deal values hVIVO shares at 15.56 pence each, a 34% premium to the clinical development services company’s closing price of 11.62p on December 8, the day before the initial announcement.
In the Monday announcement, it was said that hVIVO will own 45% of the newly formed parternship with Open Orphan taking the other 55%.
Arden Partners (LON: ARDN) will be acting as broker and nominated advisor.
Shareholders were further impressed as Open Orphan announced a three year contract with a German Pharmaceuticals giant, which has built on an existing relationship.
Terms of the deal and financial details are yet to be provided, however Open Orphan remained optimistic saying said the new deal guaranteed “significant annual revenue” with work expected to get underway this month.
“This new contract is further evidence of Open Orphan delivering against one of its key objectives, transforming Venn by transitioning from ad-hoc short-term contracts to long-term contracts with high quality customers thereby delivering secured recurring revenues for the business,” said chief executive Cathal Friel.
“We look forward to delivering the contract and building upon this great partnership with one of the leading companies in the European pharma industry.”
hVIVO deal
In December, the firm announced the tie up deal with hVIVO. Under the terms of the agreement, hVIVO shareholders will receive 2.47 new Open Orphan shares per hVIVO share.
Open Orphan Chief Executive Cathal Friel said: “The merger of Open Orphan and hVIVO is a key milestone in the execution of our strategy to become a larger-scale specialist pharma services business and in complementary segments where specialist skills and know-how command higher margins.
“The merger allows the combined business to maximise shareholder value through delivering cost and revenue synergies across the businesses and one that is better positioned to consistently capture greater market share as part of a properly profitable business with losses confined to the past.”
Shares in Open Orphan trade at 5p on the announcement (+11.34%). 6/1/20 12:24BST.
