Sweden's Sobi accepts $8bn private equity offer
SWE ORPHAN BIOVI
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Swedish Orphan Biovitrum (Sobi) has recommended a cash offer from Advent International and Aurora Investment valuing the rare disease drug company at SEK 69.4bn ($8bn) in the latest private equity swoop on a European company.
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Advent and Aurora, an affiliate of GIC Pte, have offered SEK 235 for each Sobi share - 34.5% more than Sobi's closing share price on 25 August and 37.7% more than the average trading price in the previous 30 days. 25 August was the last trading day before media reports about a potential bid for the Stockholm-based drugmaker.
Sobi said its board unanimously recommended the offer to shareholders. Investor AB and Fjärde AP-Fonden, which own 36.45% and 6.96% of Sofi shares respectively have agreed to accept the offer.
The company's shares jumped 25% to SEK 239.20 at 10:30 BST.
"The board believes that the terms of the offer recognise Sobi’s long-term growth prospects, as well as the risks associated with those prospects, and provides certainty, in cash, to the Sobi shareholders," Sobi said.
Sobi produces drugs for haemophilia, autoimmune diseases, metabolic diseases and cancer supportive care. Demand for its treatments weakened during the pandemic as healthcare focused on Covid-19. The shares dropped from SEK 233 in September to SEK 134 in May before picking up as bid speculation emerged.
The offer brings Advent, a US private equity group, together with GIC, which manages Singapore's financial assets, to acquire Sobi through Agnafit, a bid vehicle. Private equity firms are on the lookout for undervalued companies outside the US, where share prices have recovered from the Covid-19 faster than in Europe.
The buyout houses' spree has raised concerns about companies being take out of public markets, loaded with debt and stripped back to generate short-term returns.
Agnafit said it wanted Guido Oelkers, Sobi's chief executive, to remain as CEO after the deal completes and that it supported management's plans for its operational sites.
"Agnafit Bidco is fully aligned with Sobi’s commitment to patients, to improve health on a global scale for a number of small and often overlooked patient populations," Agnafit said. "Agnafit Bidco's plans for the future business and general strategy do not currently include any material changes with regard to its management and employees, including their terms of employment."