(Alliance News) - Collagen Solutions PLC on Thursday agreed a 6.5 pence per share takeover offer from its largest shareholder Rosen's Diversified Inc.
Under the terms of the offer, Collagen shareholders will receive 6.5p in cash for each Collagen share held, valuing the entire existing issued and to be issued ordinary share capital of Collagen, including the existing shareholding of Rosen's Diversified, at GBP30.4 million, Rosen's Diversified said.
The offer price represents a premium that is more the double of the 2.50p closing share price of Collagen on Wednesday.
Shares in Collagen, which makes medical grade collagen, tissues and related medical devices, surged on the back of the offer and were trading level with the bid price of 6.50p per share on Thursday afternoon.
Rosen's Diversified, a US-based private company involved in food production, agrichemicals and distribution, currently owns 83.6 million Collagen shares, representing 19% of Collagen's existing share capital.
Rosen's Diversified said it has obtained irrevocable undertakings over 43% of Collagen's existing share capital and 53% of Collagen shares to which the buyout offer relates.
Including its own stake in Collagen, Rosen's Diversified either owns or has received irrevocable undertakings in regards to around 61% of Collagen's existing share capital.
Chair Chris Brinsmead said: "Collagen has built a high-performance team and significant portfolio of customers and projects, well positioning the company in the exciting regenerative biomaterials and tissue market. The offer from RDI recognises this strategic value and provides an attractive opportunity for shareholders to realise immediate value at a significant revenue multiple and premium to both the historical and prevailing share price."
By Tapan Panchal; tapanpanchal@alliancenews.com
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