 |
| BBI Diagnostics Group CEO Lyn Rees |
BBI Diagnostics Group provided details of its plans to be traded on the London Stock Exchange in June 2014 on May 19. The IPO will comprise the sale of the 25% indirect ownership interest in BBI held by parent company Alere ($ALR).
"This listing will be a major strategic step for BBI Diagnostics. As an independent public company, we believe we will be in an even stronger position to strengthen and leverage our relationships with customers, develop and commercialise new products and services, and expand our geographic presence," said incoming CEO Lyn Rees in a statement.
Alere and BBI will agree to a 180-day lock-up arrangement, according to the BBI statement. During the lock-up period, Alere can sell its shares to a single third-party buyer at a price equal to or above the offer price as long as the third party agrees to honor the remaining portion of the lock-up term.
As part of the deal with parent company Alere, BBI will have access to a new secured credit facility worth £60 million ($101 million), or three times BBI's 2013 normalized earnings. Alere had previously disclosed this element of the deal, but not the size of the credit facility.
BBI engages in reagent and laboratory immunoassay manufacturing as well as consumer and animal health diagnostics. It also has a 50% stake in home pregnancy and fertility testing product supplier SPD as part of a joint venture with Procter & Gamble ($PG), according to the statement.
Two key elements of the soon-to-be-independent company are geographic expansion and cross-selling products across its customer base, BBI explains. It expects the overall global diagnostics business to reach sales of $63.8 billion by the end of 2016. In particular, BBI says it's well-positioned to take advantage of governments' security concerns due to its products that detect harmful chemical and biological substances.
BBI earned profits of £17.9 million ($30.1 million) in 2013 on revenues of £86.9 million ($1.4 billion).
U.S.-based Alere said that it anticipates retaining the right to nominate two members to BBI's board of directors. The spinoff will help Alere pay off its $3.4 billion debt load as it attempts keep activist investor Coppersmith Capital Management at bay after the firm nearly took control of the company last year.
The initial price of the stock was not announced. More details of the IPO will disclosed in upcoming prospectus.
- read the release