Permira agrees £703m takeover of UK-listed Ergomed

Ergomed manages drug trials and monitors participants for side effects. It reported a sharp uptick in revenue last year and a record order book, at £295m as of 31 December, and growth has continued in the first half of 2023.

The 1,350p-a-share offer represents a premium of 28.3 per cent to the company’s share price at the close of play on 1 September. The company was trading at the offer price at the end of 2022.

Executive chair and founder Miroslav Reljanović said the acquisition presents an opportunity for “shareholders to realise value at a highly attractive valuation and at the same time allow Ergomed to most effectively deliver against its ambitious growth strategy”. He will make around £126m from the sale if it goes through.

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As an alternative to the cash offer, Ergomed shareholders may also select a “partial securities alternative”, through which they would receive 451p per share in cash, plus unlisted securities. However, the company’s directors have unanimously recommended that shareholders vote in favour of the cash offer and warned that the new securities will be illiquid and subject to a five-year lock-up. 

“This is another example of the UK market proving a rich environment for private equity to make acquisitions, highlighting it remains significantly undervalued,” said Stifel analyst Max Herrmann. He said the deal would likely pass a shareholder vote given Reljanović’s support. 

Source: Investors’ Chronicle

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