REG - Animalcare Group PLC - Sale of equity in STEM Animal Health Inc.

AnimalcareAnnouncement

11/04/2024 15:00

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RNS Number : 3266K  Animalcare Group PLC  11 April 2024

Animalcare Group plc

("Animalcare", the "Company" or the "Group")

 

Sale of equity in STEM Animal Health Inc. to Dechra Pharmaceuticals Limited

 

Exclusive Licence and Distribution Agreement for biofilm products enhanced

 

11 April 2024. Animalcare Group plc (AIM: ANCR), the international animal
health business, today announces that it has reached agreement in principle to
sell its 33.34% equity stake in STEM Animal Health Inc. (STEM) to Dechra
Pharmaceuticals Limited ("Dechra") for a total cash payment of US$4.7m,
payable upon completion of the transaction. STEM is currently owned by
Animalcare and Canada-based Kane Biotech Inc. ("Kane Biotech").

 

Other items covered by the agreement (the "Agreement") will bring the total
potential monetary value of the deal for the Group to approximately US$5.4m.
The sale of the minority stake secures a positive return on investment for
Animalcare while further strengthening the Group's cash position following the
disposal of Identicare announced on 28 February 2024.

 

STEM was established in September 2020 as a joint venture by Animalcare and
Kane Biotech with a focus on treating biofilm-related ailments in animals.
Under that agreement, Animalcare was granted rights to commercialise products
based on Kane Biotech's coactiv+(TM) and DispersinB® technology in global
veterinary markets outside the Americas.

 

Under the terms of the Agreement, the existing licence and distribution
agreement with STEM will be extended to allow Animalcare access to all
channels in Europe and the UK. This means Animalcare can maximise the value of
the dental franchise through both veterinary and retail channels including via
e-commerce.

 

In addition, Animalcare will maintain influence over the choice of new product
development options associated with the licensed intellectual property through
a newly formed joint innovation team with Dechra and Kane Biotech.

 

Completion of the transaction requires the consent of more than 50% of the
shareholders of Kane Biotech.

 

Chief Executive Officer of Animalcare, Jenny Winter said: "This transaction
offers value for Animalcare on several levels. Not only have we secured an
attractive return on our equity investment in STEM that adds to our investment
firepower, we have gained enhanced commercial licensing rights that grant us
more options to reach pet owners in these key markets. Further into the
future, I'm also excited about the potential to accelerate development of new
biofilm-targeting products by combining the knowledge and resources of all
three parties."

 

About Animalcare

Animalcare Group plc is a UK AIM-listed international veterinary sales and
marketing organisation. Animalcare operates in seven countries and exports to
approximately 40 countries in Europe and worldwide. The Group is focused on
bringing new and innovative products to market through its own development
pipeline, partnerships and via acquisition.

 

For more information about Animalcare, please visit www.animalcaregroup.com
(http://www.animalcaregroup.com/) or contact:

 

 Animalcare Group plc                      +44 (0)1904 487 687

 Jenny Winter, Chief Executive Officer

 Chris Brewster, Chief Financial Officer

 Media/investor relations                  communications@animalcaregroup.com (mailto:communications@animalcaregroup.com)

 Stifel Nicolaus Europe Limited            +44 (0)20 7710 7600

(Nominated Adviser & Joint Broker)

 Ben Maddison

 Nick Adams

 Nick Harland

 Francis North

 Panmure Gordon                            +44 (0)20 7886 2500

 (Joint Broker)

 Corporate Finance

 Freddy Crossley/Emma Earl

 Corporate Broking

 Rupert Dearden

 

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