Dechra raises £180m in discounted placing for Piedmont deal

Dechra Pharmaceuticals slumped on Thursday after the animal drug maker raised around £180m in a discounted share placing for the acquisition of US-based Piedmont Animal Health.

The company placed just over 5.2m shares at 3,430p each, which is a discount of around 8% to the closing middle market share price on Wednesday.

The proceeds will be used to help fund the £175m cash acquisition of Piedmont, which was announced late on Wednesday. Piedmont specialises in developing novel and differentiated products for the companion animal market and has a strong development track record, Dechra said.

Piedmont has eight novel products in various stages of development serving both the cat and dog markets. Dechra said the products are all within its key therapeutic areas of competence.

The two lead development products are expected to launch in financial years 2024 and 2025 with an expected peak sales potential of at least $40m, in aggregate.

"Each of the products in the remainder of the portfolio are significant and are expected, if approved, to be well within Dechra's top twenty products by sales (being greater than $10m) with one having a significantly higher potential," it said.

At 0920 BST, the shares were down 6.2% at 3,498p.