LONDON (Alliance News) - Quantum Pharma PLC Tuesday said it has acquired NuPharm Group Ltd and its wholly-owned subsidiary NuPharm Laboratories Ltd for an initial GBP9.3 million in cash.
The pharmaceutical manufacturer said it will pay GBP9.3 million in cash on completion, with up to a maximum of GBP4 million potentially payable additionally under earn-out arrangements. Quantum also will fund the settlement of NuPharm's GBP0.6 million in debt.
Quantum added that it has also secured new banking facilities with Royal Bank of Scotland and Lloyds Bank PLC, comprising a term loan of GBP25 million and a revolving credit facility of GBP10 million, replacing the the existing GBP15 million term loan which is now fully drawn following the acquisition.
NuPharm is a UK-based, outsourced manufacturer for solid and liquid dose small batch-made specials and niche licensed pharmaceutical products. It operates from facilities in North Wales.
NuPharm generated a revenue of GBP3.9 million and adjusted earnings before interest, tax, depreciation and amortisation of GBP1.1 million in 2014.
Quantum said the acquisition will introduce batch manufacturing and licensed product manufacturing capabilities to the group, and will allow it to replace existing products currently purchased from third-party suppliers with products manufactured at NuPharm. Quantum said it will overhaul NuPharm's systems and invest in new equipment and resources in order to increase production levels. It expects the acquisition to be earnings enhancing from early 2016.
"Building upon the successful acquisition of Lamda earlier this year, the acquisition of NuPharm represents a further important and exciting milestone for the group as it significantly accelerates its strategic growth plan, further strengthening the business for the medium and long term. The addition of NuPharm to the group will be earnings enhancing from early 2016 after a period of integration, operational and quality process improvements and system investment in the second half of this year," Chief Executive Andrew Scaife said in a statement.
"NuPharm adds further vertical integration to Quantum, provides the group with a ready base of additional customers and as well as additional capabilities extending from research and development through to bespoke and batch manufacture of both unlicensed and licensed medicines. This acquisition will further enhance our product offering and broaden our product range. In addition, the new debt facilities put Quantum in a strong position to accelerate the growth of the group over and above the NuPharm acquisition," he added.
Shares in Quantum were trading up 0.1% at 157.60 pence Tuesday morning.
By Karolina Kaminska; karolinakaminska@alliancenews.com @KarolinaAllNews
Copyright 2015 Alliance News Limited. All Rights Reserved.
