FTSE 100 chemicals giant Croda International is to buy a Danish pharmaceutical business, Biosector, for £65m.
Snaith-based Croda said Biosector is a specialist in the manufacture and supply of adjuvants for the human and veterinary vaccine market. Adjuvants are extensively used in human and veterinary vaccines to increase their effectiveness.
The total consideration is £65m in cash and the transaction is expected to close by the end of 2018.
Steve Foots, chief executive of Croda, said: “Biosector is a rare asset, in a high value, fast growing sector of the global pharmaceutical market.
“With an experienced, high quality team, Biosector brings world-class protected technologies and industry leading manufacturing facilities.
“Furthermore, the strong cultural alignment between Biosector and Croda enhances our highly technical-based sales approach and emphasis on value over volume. The opportunity to quickly build upon Biosector’s impressive track record to date is enormously exciting and we look forward to welcoming the team to Croda.”
Biosector was founded in 1939 and operates from a GMP-certified adjuvants manufacturing facility in Frederikssund, Denmark.
Croda said its product portfolio includes innovative aluminium and saponin-based adjuvants. Aluminium-based adjuvants provide a platform to introduce new technically advanced saponin-based adjuvants.
The firm said vaccine adjuvants are a natural extension to Croda’s market leading, high-purity excipient delivery systems in its Health Care business.
It added that these adjuvants represent a niche, high growth market, driven by increased healthcare spending alongside advances in biotechnology and the growing need for preventative treatments.
“Biosector is differentiated through its high quality portfolio of adjuvants, with a strong position in human applications,” said Mr Foots
On completion, Biosector will be integrated into Croda’s Health Care business within the Life Sciences sector.
It will continue to be led by its current team. Croda said that the team all of whom have extensive, class leading credentials and pharmaceutical experience.
Croda said it will leverage its formulation and purification expertise to accelerate the development of Biosector’s rich pipeline of next generation adjuvant systems. Croda will also use its dedicated global sales network to deliver Biosector’s growth potential.
Last month Croda reported growth across all of its regions and a strong performance in its consumer businesses.
The firm is working closely with a number of “indie” cosmetic firms to produce best selling shampoos, conditioners, lip glosses and other beauty products.
Previously, Croda has made ingredients for skin, hair and cosmetic products for multinational giants such as L’Oreal, Estee Lauder and Boots, but now it is turning its attention to the indie sector.
The group said the sales momentum seen in the first half of the year continued in its third quarter to September 30.
Croda said constant currency sales rose by 3.4 per cent, with the core business up 4.5 per cent, driven by the strong performance in its consumer businesses.
Core business year to date growth was 4.7 per cent and sales of New and Protected Products (NPP) reached 28.4 per cent of total sales.