TIDMINS
RNS Number : 6396Z
Instem plc
31 May 2016
Instem plc
("Instem", the "Company" or the "Group")
Earnings Enhancing Acquisition of Samarind Limited
("Samarind")
Acquisition of Regulatory Information Management Solutions
Provider, Issue of Equity
and Total Voting Rights
Instem (AIM: INS.L), a leading provider of IT solutions to the
global early development healthcare market, announces the
acquisition of UK-based Samarind (the "Acquisition"), for a total
consideration of up to GBP2.5m, to be satisfied by a combination of
cash and new ordinary shares in the Company. The Acquisition is
expected to be earnings enhancing in 2016 and going forward.
The consideration comprises GBP1.5m on completion (the "Initial
Consideration"), GBP0.65m of deferred consideration (the "Deferred
Consideration") and up to a further GBP0.35m which is payable
contingent upon the financial performance of Samarind (the "Earn
Out"). Further information on the terms of the Acquisition is set
out below.
About Samarind
Samarind is based in Deeside, UK and provides Regulatory
Information Management ("RIM") software ("Samarind RMS") and
services to the life sciences sector. Its solutions significantly
enhance the quality of regulatory information and help to achieve
and maintain compliance for pharmaceutical, biotech and medical
device products. Samarind has 10 employees.
The Samarind RIM software and services provide the security,
flexibility and ease of use that regulatory affairs teams need to
achieve and exceed their regulatory and commercial requirements.
Deployed on-site or accessed on-line, Samarind's solutions provide
a smarter way to manage the acquisition and maintenance of product
licences.
The Emerging Market Opportunity
The European Medicines Agency ("EMA") is currently in the
process of implementing the standard developed by the International
Organisation for Standardisation ("ISO") for the Identification of
Medicinal Products ("IDMP"). This is a set of common global common
standards for data exchange, formats and terminologies for the
unique identification of medicines.
Samarind worked extensively with the EMA on the original EVMPD
standard in 2005 and was first to market with a fully working EVMPD
solution.
Importantly, Samarind's RIM solution has been designed to adapt
to each iteration of the EMA implementation of IDMP, which will
replace EVMPD and is expected to evolve into a global standard as
the guidelines are published.
Acquisition Rationale
The Acquisition extends Instem's portfolio of leading data
exchange and management software solutions and provides additional
opportunities to provide out-sourced regulatory services.
Instem will integrate Samarind quickly and will be targeting
increased market penetration in specific functional and geographic
sectors. Instem, which is already working directly with many
regulatory departments on SEND (the Standard for the Exchange of
Non-clinical Data), will introduce Samarind RMS to its client base
so as to deliver more commercial value and regulatory power to
these relationships.
In its last financial year ended 31 March 2016, Samarind
reported sales of GBP1.2m and operating profits of GBP0.4m and the
acquisition is expected to be earnings enhancing in 2016. As at 27
May 2016, Samarind had net assets of approximately GBP0.04m,
including GBP0.68m of cash, with no debt.
Terms of the Acquisition
The Initial Consideration is being satisfied by GBP1.3m in cash
and GBP0.2m in new ordinary shares of 10 pence each in the Company
(the "Initial Consideration Shares"). The cash is being funded from
existing resources following the fund raise earlier in 2016.
The Deferred Consideration, to be satisfied in a combination of
cash and shares (at Instem's discretion), comprises GBP0.45m which
is payable in May 2017 (up to GBP0.175m in shares) and GBP0.2m
which is payable in May 2018 (up to GBP0.1m in shares).
The Earn Out comprises up to GBP0.35m payable in cash,
contingent upon the profits of Samarind in the first twelve months
post Acquisition and, if achieved, would be payable in the second
half of 2017.
Application will be made to the London Stock Exchange for the
admission of the 86,393 Initial Consideration Shares and admission
is expected to take place at 8.00 a.m. on or before 6 June
2016.
Total Voting Rights
Following the issue and allotment of the above Initial
Consideration Shares, the Company's issued share capital comprises
15,702,452 ordinary shares of 10 pence each. The Company does not
hold any ordinary shares in treasury, therefore the total number of
voting rights in the Company is 15,702,452.
The figure of 15,702,452 may be used by shareholders as the
denominator for the calculations by which they will determine if
they are required to notify their interest in, or a change of their
interest in, the Company under the FCA's Disclosure and
Transparency Rules.
Dr. Olaf Schoepke, Vice President, Regulatory Solution
Development at Samarind, stated: "On behalf of our clients and
staff, we couldn't be happier to be part of the Instem group and
the transformation they are leading in health and life sciences.
This acquisition by Instem brings core regulatory submission and
regulatory information management capabilities together so we can
expand the value and impact that we bring to our client
partners."
Phil Reason, CEO of Instem plc, further commented: "Samarind
aligns perfectly with our strategy of expanding organically and
acquisitively into adjacent market areas, particularly those having
strong regulatory drivers for technology adoption. Although the
Samarind solutions have relevance to product research and
development, the larger segment of the market is for marketed drugs
and medical devices, enabling Instem to tap into new areas of
market expenditure. Our global presence is also a key asset to the
Samarind business."
For further information, please contact:
Instem plc +44 (0) 1785 825 600
Phil Reason, CEO
Nigel Goldsmith, CFO
N+1 Singer (Nominated Adviser
& Broker) +44 (0) 20 7496 3000
Richard Lindley
Nick Owen
Walbrook Financial PR +44 (0) 20 7933 8000
Paul Cornelius instem@walbrookpr.com
Helen Cresswell
Sam Allen
Paul Whittington
About Instem
Instem is a leading supplier of IT applications to the early
development healthcare market delivering compelling solutions for
data collection, management and analysis across the R&D
continuum. Instem applications are in use by customers worldwide,
meeting the rapidly expanding needs of life science and healthcare
organizations for data-driven decision making leading to safer,
more effective products.
Instem's portfolio of software solutions increases client
productivity by automating study-related processes while offering
the unique ability to generate new knowledge through the extraction
and harmonization of actionable scientific information.
Instem supports over 450 clients through offices in the United
States, United Kingdom, Japan, China and India.
To learn more about Instem solutions and its mission, please
visit www.instem.com
This information is provided by RNS
The company news service from the London Stock Exchange
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May 31, 2016 02:01 ET (06:01 GMT)