Novacyt S.A.: Acquisition of IT-IS International Ltd
15 Ottobre 2020 - 12:30PM
Business Wire
Deal in line with strategy, secures key IP
for the Company’s rapid-PCR instruments, expands its core
capabilities and product offering
Regulatory News:
Novacyt (EURONEXT GROWTH: ALNOV; AIM: NCYT), an international
specialist in clinical diagnostics, announces the acquisition of
the entire share capital of IT-IS International Ltd (IT-IS), a
profitable diagnostic instrument development and manufacturing
company, for an initial cash consideration of £10.1 million. IT-IS
is the exclusive manufacturer of Novacyt’s q16 and q32 rapid
polymerase chain reaction (PCR) instruments.
Highlights
- Reinforces new strategy, as announced on 17 September
2020:
- Secures key IP for Novacyt’s q16 and q32 rapid-PCR instruments
crucial for near-patient testing of COVID-19
- Expands Novacyt’s core capabilities in instrument
manufacturing
- Expands Novacyt’s product offering in mobile PCR devices
- Immediately earnings accretive – IT-IS delivered revenues of
£3.9 million and a net profit of £0.8 million for FY19, with
revenues expected to increase to £5.0 million for FY20
- Strengthens Novacyt’s position to support the longer-term
growth opportunity for rapid near-patient testing
Graham Mullis, Group CEO of Novacyt, commented: “We are
delighted to announce this strategically important acquisition of
IT-IS and we welcome the employees to the Novacyt Group. IT-IS has
established a reputation as experts in the development of mobile
and rapid PCR instruments. Novacyt has been working with IT-IS for
more than five years through the sale of the q16 and q32
instruments. During this time, IT-IS has proven the quality,
performance and reliability of its mobile PCR platform. This
acquisition ensures that Novacyt is in a strong position to fulfil
the growing market demands for rapid near-patient testing of
COVID-19, as well as other infectious diseases.”
Roderic Fuerst, Managing Director of IT-IS, added: “We
are delighted to join the rapidly growing Novacyt Group. Working
together since 2014, we have developed excellent working
relationships with the team at Primerdesign and formed a clear
understanding of the complementary nature of our respective
businesses. We look forward to applying our expertise in
instrumentation as part of the Novacyt Group to create world class
integrated diagnostic workflows. In the short-term our clear
mission is to support the Novacyt Group in delivering systems in
volume to support expanded point of need COVID-19 testing this
winter.”
IT-IS – a profitable diagnostic instrument development and
manufacturing company IT-IS is a private UK based diagnostic
instrument development and manufacturing company specialising in
the development of PCR devices for the life sciences and food
testing industry. The company, located in Stokesley near
Middlesbrough, was founded by Benjamin Webster, Roderic Fuerst and
James Howell in 2004. It has established a reputation for high
quality and easy to use mobile PCR products, which are sold in more
than 50 countries worldwide.
IT-IS delivered revenues of £3.9 million at a gross margin of
55% and a net profit of £0.8 million for the year ended 31 December
2019. In the six months ended 30 June 2020, revenues increased
significantly to an annualised £5.0 million with an improved gross
margin of 58%, due to higher levels of activity driven by the
COVID-19 pandemic. The net assets of IT-IS and the business assets
of IT-IS Life Science (Ireland) Limited that are being acquired,
was £2.6 million at 30 June 2020.
Acquisition rationale The acquisition of IT-IS reinforces
Novacyt’s strategy, as announced on 17 September 2020, by
strengthening the Company’s IP portfolio to enhance and secure
future value, as well as further expanding its core capabilities,
whilst maintaining attractive margins. It also means the Company is
well placed to expand its near-patient product offering through the
existing IT-IS instruments and also through new product
developments.
As a result of this acquisition, Novacyt will become a
diagnostic platform instrument and reagent manufacturer and will
significantly increase the manufacturing capability of IT-IS to
manage the expected demand for its q16 and q32 PCR instruments. As
a result of higher manufacturing volume, the Company expects to
reduce its cost of goods and therefore improve the gross margin of
its instrument sales.
The COVID-19 pandemic presents Novacyt with a significant
opportunity to place rapid mobile testing instruments where the
shortage of testing capacity and limitations of laboratory-based
testing is driving healthcare away from large centralised platforms
towards decentralised, more flexible platforms. This is
demonstrated by the Company’s recently announced second supply
contract with the UK Department of Health and Social Care. Beyond
COVID-19, the Directors believe there is the potential for a
long-term shift in testing policy towards decentralisation. With
the acquisition of IT-IS, the Company is well positioned to address
this drive towards rapid, decentralised testing and deliver
additional growth opportunities.
Terms of the acquisition Under the terms of the
acquisition, £10.1 million in cash will be paid upfront by the
Company for the entire issued share capital of IT-IS and for the
business assets of IT-IS Life Science (Ireland) Limited. The
initial consideration of £10.1 million will be reduced by £3.6
million of cash on the balance sheet of IT-IS at completion
resulting in net cash consideration of £6.5 million. In addition,
an earn out of up to £1.9 million in cash is payable to the
directors of IT-IS over the next two years, subject to certain
manufacturing targets being achieved.
The acquisition includes the customers, suppliers, software,
patents, trademarks, contracts, stocks, technical files and
know-how in order to design, manufacture, distribute and market all
of IT-IS’s commercial product portfolio. In addition to the q16 and
q32 instruments, this include IT-IS’s own branded instruments, MyGo
Mini and MyGo Pro.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
- End -
About Novacyt Group The Novacyt Group is an international
diagnostics business generating an increasing portfolio of in vitro
and molecular diagnostic tests. Its core strengths lie in
diagnostics product development, commercialisation, contract design
and manufacturing. The Company's lead business units comprise of
Primerdesign and Lab21 Products, supplying an extensive range of
high quality assays and reagents worldwide. The Group directly
serves microbiology, haematology and serology markets as do its
global partners, which include major corporates.
For more information please refer to the website:
www.novacyt.com
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201015005485/en/
Novacyt SA Graham Mullis, Chief Executive Officer Anthony
Dyer, Chief Financial Officer +44 (0)1276 600081 SP Angel
Corporate Finance LLP (Nominated Adviser and Broker) Matthew
Johnson / Charlie Bouverat (Corporate Finance) Vadim Alexandre /
Rob Rees (Corporate Broking) +44 (0)20 3470 0470 Numis
Securities Limited (Joint Broker) Freddie Barnfield / James
Black +44 (0)20 7260 1000 Allegra Finance (French Listing
Sponsor) Rémi Durgetto / Yannick Petit +33 (1) 42 22 10 10
r.durgetto@allegrafinance.com; y.petit@allegrafinance.com FTI
Consulting (International) Victoria Foster Mitchell / Mary
Whittow +44 (0)20 3727 1000
victoria.fostermitchell@fticonsulting.com /
mary.whittow@fticonsulting.com FTI Consulting (France)
Arnaud de Cheffontaines +33 (0)147 03 69 48
arnaud.decheffontaines@fticonsulting.com
Grafico Azioni Novacyt (EU:ALNOV)
Storico
Da Feb 2024 a Mar 2024
Grafico Azioni Novacyt (EU:ALNOV)
Storico
Da Mar 2023 a Mar 2024