RE: Some extra insights from Myles18 Aug 2021 18:59
I also found it interesting that Myles has mentioned in his revised thesis the possibility of a beneficial take-over of Abingdon Health. I don't think this has been considered before and I wonder if this possibility came into his head after the 'touch base' with Avacta last week?....
To establish – or acquire – proprietary manufacturing capacity for LFTs and other IVD products that Avacta plans to launch. With regards to the latter option, the obvious takeover candidate would be existing manufacturing partner, Abingdon Health. The business has a weakened balance sheet, having been messed around by the DHSC, which has seen its market capitalisation collapse from circa £100m, following its IPO last year, to a mere £25m. Not only would the acquisition of Abingdon result in an immediately increased manufacturing capacity for the AffiDX LFT, but it would be an extremely useful asset for Avacta in future product development (making it a much faster – and cheaper - process). Given the current valuations of both companies, an all-share offer would, in our view, be highly value accretive to both sets of shareholders.