LONDON (Alliance News) - Regent Pacific Group Ltd on Tuesday said it has agreed to acquire the shares it doesn't already own in Plethora Solutions Holdings PLC, valuing the premature ejaculation treatment company at 11.65 pence per share.
The deal values Plethora at about GBP95.9 million, based on the number of shares in issue, and at GBP114.3 million when considering its fully diluted share capital. Shareholders in Plethora will receive 15.7076 new Regent Pacific shares for each Plethora share they own. Shares in Plethora jumped by 18% to 5.30p on Tuesday afternoon.
The deal comes about six weeks after the companies said they had agreed on the key terms of a possible deal.
James Mellon is the non-executive chairman of Plethora and non-executive co-chairman of Regent Pacific, and Jamie Gibson is an executive director and the chief executive of both companies. Plethora's main product is PSD502, a treatment for premature ejaculation.
On completion of the offer, Plethora shareholders other than Regent Pacific will own about 65.98% of the combined group.
"This offer is about optimising growth and realising the potential of an innovative product that can address a known medical condition affecting almost one in four men. With increased investment and commercial innovation, we see huge scope for the product initially in Europe where it has approval, and in the important US market and in the fast growing Asian market in due course," James Mellon said.
"We view the offer as taking account of PSD502TM's prospects, while also providing a compelling premium of more than 38% to the price at which Plethora's last issued shares in August 2014 and we believe it will create significantly more future value than Plethora could achieve independently," Mellon added.
Michael Wyllie, chief science officer at Plethora, said the deal presents an "achievable solution to its difficult financial position whilst providing shareholders an opportunity to maintain an ongoing economic interest in Plethora and its product".
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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