The £6.7m ($10.4m) deal would see Nottingham, UK-based Source BioScience add the pharmaceutical testing and microbiological analysis firm Select, adding additional stability storage and stability testing laboratory services to its client offerings.
These services are “highly complementary,” said Source BioScience CEO Nick Ash, who added the acquisition would help the firm meet “increasing demand for stability and pharmaceutical batch release testing services, from a broad spectrum of customers and from territories that Source BioScience does not currently address.”
The merger – expected to be completed in September - would see the firm operate a network of stability storage and laboratory facilities extending from the UK to the East and West coasts of the US, as well as extend the company’s presence in emerging markets including India and China where Select has a commercial presence.
“This proposed acquisition fits squarely with our stated objective of continued expansion through targeted acquisitions, to enhance the breadth and depth of our portfolio of services, in conjunction with ongoing organic growth and development of the existing business,” Ash added.
The deal was welcomed by N+1 Singer Equity Research analyst Chris Glasper, who said: “Select’s offering is highly complementary to Source’s stability storage services and will be immediately accretive to earnings… without factoring in any potential cost or revenue synergies.”