LONDON, UK: Venture Life Group has acquired PharmaSource BV, a Netherlands based development and distribution business, for an initial consideration of €5.23 million and deferred contingent consideration of up to €1.27 million.
Venture Life agreed to acquire the entire issued share capital of PharmaSource BV for an initial consideration of €5.23 million, and deferred contingent consideration of up to €1.27 million. These payments will be funded entirely from the Company’s existing cash resources, and the acquisition is expected to be immediately earnings accretive.
The acquisition is also subject to conditions and price adjustment for cash and debt.
PharmaSource owns a number of medical device products in key therapeutic areas including fungal nail infections, wart removal and women’s health. These products are distributed both through retail pharmacies in the Netherlands and through key international distribution partners outside of the Netherlands, including the UK, Germany, the Nordics, Belgium and France.
Strategically, this acquisition will enable the Company to broaden its product range and extend its global reach by providing additional retailers and distribution partners to its existing partner network.
PharmaSource is a growing business and revenues for the year ending 31 December 2019 are expected to be in excess of €2.5 million (2018: €1.8 million), with Profit Before Tax in excess of €0.9 million (2018: €0.5 million). It is expected to have gross assets of around £0.6 million at completion.
PharmaSource owns various medical device registrations, for products marketed under several different brand names. Once the post-completion integration process gets underway, there are expected to be strong synergistic benefits of the acquisition for the Venture Life Group going forward, anticipated to enable the acquired business assets to continue to grow both revenues and profitability under our stewardship.
The Company also announced that it expects its revenues for the year ending 31 December 2019 to be at least £20 million and adjusted EBITDA to be at least £3.2 million, before non-recurring operating costs of approximately £0.2 million, principally relating to the restructuring of the Company’s finance team.
Jerry Randall, CEO of Venture Life Group, said: “We are delighted to acquire this high quality, growing and profitable business, which gives us our first European footprint directly into the retailer market. Once completed, the acquisition should be immediately earnings enhancing for Venture Life, is being funded totally from our existing cash resources and will benefit from the operational leverage we can bring. The acquisition brings an excellent range of products and customer relationships to Venture Life, which we expect to be able to leverage through our existing products and relationships further. We see this as another excellent add-on to our existing business, that we can further grow and develop within our existing structure.
“We expect to finish the year with revenues and profits ahead of 2018. Despite some one-off costs in the first half, we have been pleased with the performance of the wider Group, which has delivered good growth against a complex macro-economic backdrop. This performance, when enhanced by completion of this excellent acquisition opportunity on an earnings accretive basis in our profit and loss account for 2020, provides us with confidence for the year ahead, and makes us very well positioned for continued growth.”