- Evotec to further strengthen its integrated innovation offering with world-class compound management
- Synergies with Evotec's drug discovery alliance business expected
- €12.5 Mio total purchase price for profitable business will be paid in cash to GALAPAGOS
- EVOTEC Revenue guidance 2011 will increase, strategic cash position remains strong
Hamburg, Germany; Mechelen, Belgium - 1 June 2011: Evotec AG (Frankfurt Stock Exchange: EVT; TecDAX) and Galapagos NV (Euronext: GLPG) today announced that Evotec has acquired Compound Focus, Inc., the compound management business of BioFocus, a Galapagos Company.
Strengthen Evotec's leadership role in drug discovery
This acquisition allows Evotec to augment its early drug discovery offering substantially, provides critical mass to its existing compound management offering, and adds profitable revenues. Compound Focus, Inc. is based in South San Francisco, US and is the world leader in small molecule compound management services. The company's technologies are focused on automated storage and custom design solutions for small molecule drugs. The current key customer base includes US federal institutes and pharma companies such as Elan, Lundbeck, Sepracor or Procter & Gamble. In 2010, Compound Focus had revenues of €7.8 m with an operating profit of €2.6 m.
Transaction structure reflects value potential
For the acquisition of all shares in Compound Focus Inc. Evotec will pay Galapagos an immediate cash upfront of €10.25 m and an additional €2.25 m in potential earn out payments upon performance of the business in 2012/2013 depending on revenues and certain corporate milestones.
Dr Werner Lanthaler, Chief Executive Officer of Evotec, commented:
"This acquisition will substantially improve our ability to support our alliance partners in developing and managing their compound libraries. The link to our industry leading screening platform further strengthens our hit identification capabilities. In addition, the profitable revenues shown by Compound Focus over the last years will further enhance our earnings profile going forward."
Onno van de Stolpe, Chief Executive Officer of Galapagos, commented:
"Today's transaction enables us to concentrate on what we do best in BioFocus and Argenta, providing top class drug discovery solutions needed to deliver molecules for our customers. Compound management is not strategic to our offering. We are pleased to have found a good home for Compound Focus and wish them continued success as part of Evotec."
Following this transaction, Evotec changes its revenue guidance for 2011 from €64-66 m to €68-70 m, and Galapagos changes its revenue guidance for 2011 from €150 m to €146 m.
With comfortably more than €55 m liquidity by the end of 2011, despite the recently closed acquisition of Compound Focus, the strategic cash position of Evotec remains very strong.
Burrill Merchant Banking acted as financial adviser to Galapagos.
Evotec invites you to join a conference call announcing the acquisition of Compound Focus, Inc.