Wednesday 21 August 2019

New Venn Life owners target €50m in revenue by 2022

Cathal Friel will be the new CEO
Cathal Friel will be the new CEO

Michael Cogley

The new owners of listed clinical trials firm Venn Life Sciences intend to grow its revenue from €15m a year to €50m within the next three years, it is understood.

Pharma services business Open Orphan performed a reverse takeover of Venn Life last Friday. The move was driven by Cathal Friel, formerly of Fastnet Oil & Gas and Amryt Pharma.

Shareholders are expected to vote to approve the takeover in June, as well as a name change to Open Orphan PLC.

The company has also begun raising funds to recapitalise the Venn Life business, which issued a profit warning alongside its 2018 results. It is believed the fundraise is being led by Arden Stockbrokers in London and by Tom Godfrey of IBI Corporate Finance.

"The new entity intends on adding around €35m to the company's revenue over the next three years," according to a source familiar with the company.

"That will be achieved through a number of acquisitions and deals, at which point the new owners will look to sell the business to a bigger player."

Shares in Venn Life were suspended on the London AIM market last Friday morning as the company announced the merger.

The transaction will see Venn issue new shares to meet the £5.7m valuation of Open Orphan, which will be issued to Open Orphan's shareholders.

Friel will take over as the new chief executive while Tony Richardson, the company's current CEO, will assume the role of corporate development director are the new entity.

Venn Life also published its annual results on Friday, which showed a loss of €1.06m as well as a slide in revenues, down to €14.6m from €17.8m a year earlier.

Directors of the group expect there should be an increase in revenues and profitability in the coming months but additional financial resources were required.

Sunday Indo Business

Also in Business