VICTORIA, Dec. 28, 2017
VICTORIA, Dec. 28, 2017 /CNW/ – IMMUNOPRECISE ANTIBODIES LTD. (the “Company” or “IPA”) (TSX VENTURE: IPA)(OTC PINK: IPATF) announces that it has signed a binding letter of intent with Preclinics GmbH (“Preclinics“) whereby the Company has agreed to acquire all of the issued and outstanding shares of Preclinics (the “Transaction“).
The Transaction continues to realize on the Board’s commitment to grow globally through strategic acquisitions. It contributes significantly to IPA extending its ambition of becoming a single source provider of services across the full antibody discovery value chain (antigen design, hit generation, lead selection, lead optimization and lead characterization) and to offer the full spectrum of antibody production methodologies (library based technologies, hybridoma methods, transgenic animal based platforms and single B cell based technology). Furthermore, the acquisition enhances the Company’s source of and capacity for in vivo and in vitro research and formats.
“In acquiring Preclinics GmbH, IPA continues to build its capacity as a single source provider for the antibody discovery process through pharmacological contract research and research services and capabilities targeted to immunization and production of antisera as well as animal care facilities” said Dr. James Kuo, Chairman, Interim President of the Company.
Preclinics is a privately held company based in Potsdam, Germany which has three separate facilities (Potsdam site; Behring Campus Eystrup and its research farm) which performs in vivo research in rodent models and in vitro research in cell culture and other in vitro formats. Preclinics also offers contract immunization and contract production of antisera, and contract housing and breeding of laboratory animals. Preclinics has developed its own proprietary technology such as ImmunoJunction fusion antibodies for redirecting an existing immunity to a new target and research instruments such as the REVOLYZER for tracking of rodent behaviour and is in the process of developing its own library based technology.
The Transaction adds important intellectual property and technology to the Company’s product, service and technology estate.
Terms of Transaction with Preclinics
Under the binding letter of intent, the Company and Preclinics have agreed to negotiate a definitive agreement (the “Definitive Agreement“) whereby the Company will acquire all of the issued and outstanding shares of Preclinics for €2,300,000 (CAD$3,450,000) (the “Purchase Price“) (A) payable 35% in cash and the remainder by the issuance of common shares of the Company on closing of the Transaction, and (B) an additional €750,000 (CAD $1,125,000) is to be paid in succession payments over a period of 3 years based on continued profitability with €250,000 (CAD $375,000) within one year, €250,000 (CAD $375,000) in year 2 and €250,000 (CAD $375,000) in year 3 with option of Preclinics’ shareholders to take the payments in cash or equity.
The letter of intent also sets forth the Company’s commitment to fund Preclinics, after being acquired by the Company, and to enter into a separate agreement with Preclinics shareholders on the development and commercialization of Immunojunction. The CEO and CFO of Preclinics will also enter into a three year management contract, which will include non-solicitation and non-competition clauses.
The parties will be entitled to carry out due diligence of each other until February 28, 2018. Upon the parties completing due diligence to their reasonable satisfaction, the parties will enter into the Definitive Agreement setting forth the terms and conditions of the Transaction by February 28, 2018. Completion of any transaction with Preclinics is subject to a number of conditions, including but not limited to, completion of due diligence, negotiation of definitive agreements in respect of such a transaction, the availability of financing on terms acceptable to the Company, and receipt of any required regulatory and shareholder approvals. A transaction cannot be completed until these conditions are satisfied, and there can be no assurance that a transaction will be completed at all.