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Healthcare Investment Opportunities

  • BY: Andrew Hore |
  • POSTED: 17/12/2013 |

Collbio is reversing into Aim shell Healthcare Investment Opportunities.

Collbio itself is expanding its operations by acquiring California-based Collagen Solutions LLC, which “provides medical grade bovine collagen, corium and tendon from closed herd and GBR1 countries and customised collagen based on customer requirements“. It also provides research and development services for medical devices. Collagen Solutions made a profit of £85,000 on revenues of £385,000 in the nine months to September 2013.

Collbio’s Glasgow-based contract manufacturing operation is loss-making and was previously part of Aim-quoted Angel Biotechnology, which went into administration in February. The idea is to combine the manufacturing base with the research operations.

Collbio is being acquired for £1.4m in cash and an initial £2.91m in shares at 12.5p each. A further £2.76m could be payable in cash and shares depending on performance.

The shell raised £4m, £3.65m after expenses, at 10p a share and the shares ended the first day at 11.25p each. There was still £3.63m in the bank at the end of September 2013.

The board includes David Evans as chairman and he is also a director and shareholder of Collbio. He is on the board of a number of healthcare companies including Scancell, Omega Diagnostics and EKF Diagnostics. He holds an option over 10% of the enlarged share capital of the company. A deal has to be made within 12 months and the share price has to be more than 20p for the option to vest. If that happens the option will last 10 years and will be at 10p a share.

The enlarged company’s name will be changed to Collagen Solutions. Dr Stewart White, who previously ran Angel, will become chief executive on an annual salary of £75,000.

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