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Novacyt Shares Rallied 38% on a £16.7M Cash Offer for Yourgene

Analyst Team trader
Updated 3 Jul 2023

The Novacyt SA (LON: NCYT) share price rallied 38.2% after announcing that its wholly-owned UK subsidiary had made an all-cash offer for the entire issued and to be issued share capital of Yourgene Health for a total cash consideration of £16.7 million.


YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.


According to the agreed terms, Novacyt UK has committed to paying 0.522p in cash for each Yourgene share, which represents a 167.7% premium to the Closing Price of 0.195p per Share on 30 June 2023 (being the last Business Day before this Announcement).

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The acquisition is set to be effected via a Court sanctioned Scheme of Arrangement under Part 26 of the Companies Act 2006. The two companies' boards believe the acquisition aligns with Novacyt’s post-COVID-19 strategy outlined in early 2022. 

Novacyt’s strategy focuses on expanding its global portfolio and geographic presence by pursuing organic and inorganic growth strategies, including M&A transactions. The company will expand its product portfolio via this acquisition. 

The enlarged company will create a diversified operator with a significant scale in the diagnostics industry in which both companies operate. The two companies will combine their highly complementary technologies and services while leveraging joint research and development capabilities. 

Novacyt noted that the diagnostics industry in which both companies operate is highly competitive, with many competitors operating at scale. Continued investment in R&D will develop Yourgene's service and product offering over the long term. 

The R&D efforts require highly targeted continued investment, which the acquisition will facilitate as the two companies can leverage each other's skills, technologies and resources to move their respective projects forward. 

Novacyt believes that Yourgene's core NIPT offering and PCR portfolio have significant growth potential that can be accelerated further by the significant resources and investment that Novacyt can provide, given its strong financial position.

Novacyt’s acting CEO James McCarthy said: “We are delighted to announce this recommended offer for Yourgene. We regard Yourgene as a highly respected company with a world-class team of employees that offers differentiated solutions to customers. We consider Novacyt and Yourgene to be highly complementary and expect the combination of the two businesses to benefit stakeholders of both Novacyt and Yourgene.”

*This is not investment advice. 

Novacyt share price. 

The Novacyt share price rallied 38.21% to trade at 51.00p, from Friday’s closing price of 36.90p.


YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.