A consortium backed by US firm Charles River Laboratories has agreed to acquire and privatize Hong Kong-listed Frontage Holdings in a deal valued at about HK$4.83 billion ($616 million), the company said on Monday.
The acquiring consortium comprises contract drug developer Charles River, Frontage‘s controlling shareholder Hangzhou Tigermed Consulting, and Frontage Chairman Song Li.
Under the proposal, the consortium will acquire all Frontage shares not already owned by Tigermed, Song Li and their related shareholders at HK$2.370 per share.
The deal would be at a premium of 59.1% over the firm’s last closing price HK$1.490 on October 21, before the company’s shares went on a trading halt.
Frontage provides laboratory testing and other services to pharmaceutical and biotechnology companies and operates in North America, China and other markets.
In a separate statement, Charles River said it would buy Frontage‘s bioanalysis and Drug Metabolism and Pharmacokinetics operations in Exton, Pennsylvania.
That deal is valued at about $470 million, with up to $75 million of additional contingent payments tied to future performance.
The deal allows the Massachusetts-based drug developer to expand its clinical bioanalysis services and improve its clientele from early-stage research through clinical development.
After completion, Frontage‘s businesses will be separated, with Charles River retaining ownership of the bioanalysis and DMPK operations, while the remaining businesses will be transferred to Tigermed and Song Li or their affiliates.
Reuters
