Dublin-based personal healthcare firm Integumen to raise €8m for reverse takeover bid
Dublin-based personal healthcare firm Integumen, listed on London's AIM, is planning to raise £7.5m (€8.7m) as it buys Galway-based firm Cellulac, which has developed products to make biodegradable plastic used in the cosmetics, nutritional food and healthcare sectors.
Cellulac is owned by investors including Gerard Brandon, once the chief executive of Irish wound-care firm Alltracel.
Integumen's non-executive chairman is Tony Richardson, previously a CEO of Alltracel.
Upon completion of the deal, which will constitute a reverse takeover, Mr Brandon will become chief executive of Integumen, whose name will be changed to Cellulac.
Mr Richardson is also chief executive of drug-development firm Venn Life Sciences, which owns about a quarter of Integumen.
Integumen, which floated on the Alternative Investment Market in London last year, said the proposed acquisition of Cellulac will enable it to enter the "highly attractive bio-materials and nutritional food sector, complementing its existing personal care business".
The Integumen board said that it has previously recognised the need to expand its revenue-generating activities through product acquisitions.
It said that it is also in the process of undertaking a "small debt or equity raise", in association with Cellulac, to pay on-going transaction costs and to increase its financial resources. The company has also approved a cost-reduction and cost-deferral programme with the aim of saving about £40,000 a month.
The £7.5m that Integumen plans to raise is significantly more than the £1.8m (€2m) it raised last year in its flotation, which at the time gave the fledgling company an £8.2m market capitalisation. Its current market capitalisation is just £1.9m.
Integumen said yesterday that following the acquisition of Cellulac, the enlarged group will focus on biodegradable plastic ingredients, cosmetics and human grade food supplements. It will also have a portfolio of products in oral care, medical and cosmetics.
Cellulac has 35 shareholders, including Mr Brandon and investors from Austria, Germany and Poland.
Investors in the company also include a number of Galway-based backers such as Patrick Walsh, the founder of the company.
Cellulac was spun out of NUI Galway.