London, UK -- (MARKET WIRE) -- January 9, 2007 --
FOR IMMEDIATE RELEASE 9 JANUARY 2007
London, England, 9 January, 2007 - SkyePharma PLC (LSE: SKP; NASDAQ: SKYE) today
announces the following:
- The proposed sale of its Injectable Business* to Blue
Acquisition Corp ("Purchaser") for a total consideration which
could exceed US$82 million, much of which depends on the
completion of the development and substantial future sales of
DepoBupivacaine(TM). The consideration includes an initial
payment of US$20 million (GBP10.2 million) (less costs, US$2
million (GBP1.0 million) paid into escrow, a working capital
adjustment and certain liabilities), up to US$62 million
(GBP31.7 million) of contingent milestone payments, plus a
percentage of sales of certain future products for a defined
period of time. In addition, the Injectable Business is
retaining responsibility for certain royalty-related payments
which, when made, will reduce the Continuing Group's debt to
Paul Capital.
- Placing of ordinary shares, subject to disapplication of
pre-emption rights, to certain institutional shareholders,
raising GBP14.8 million (net of expenses) (the "Placing").
- Both the Disposal and Placing are subject to shareholder
approvals which are inter-conditional. An EGM to approve the
Disposal and Placing will be held around the beginning of
February 2007.
- The proposed restructuring of the existing secured financing
facility with Paul Capital to a fixed amortisable note ("Note")
of US$92.5 million (GBP47.3 million) with up to an additional
US$12.5 million (GBP6.4 million) payable if worldwide sales of
DepoDur(TM) (a product of the Injectable Business) reach
certain thresholds. The amounts payable by the Continuing Group
under the Note will be reduced to the extent of payments made
to Paul Capital by the Injectable Business after the Disposal.
The total net present value of the maximum Note (without
allowing for the benefit of any future royalty-related payments
by the Injectable Business) is approximately GBP33 million. The
value of the Paul Capital obligations in the Group's balance
sheet as at 30 June 2006 was GBP42.0 million.
- Taking account of the new committed financing of approximately
GBP35 million announced on 27 December 2006 the total
additional funds available to the Group in the short term would
amount to approximately GBP53 million (net of costs).
- The Disposal will eliminate the significant cash costs of
operating and developing the Injectable Business. The Directors
believe that, once these transactions are concluded, the
Continuing Group will have a sound financial foundation on
which to build its future and continue to execute its strategy
of focussing on growing its pipeline of oral and inhalation
products.
A circular to shareholders setting out the reasons for and background to the
Disposal and the Placing will be sent to shareholders shortly.
Further details of this announcement are set out below.
*For the six months ended 30 June 2006, the Injectable Division, which comprises
the Injectable Business together with an allocation of corporate and other Group
costs, assets and liabilities, generated revenues of GBP3.9 million and an
operating loss of GBP11.7 million. Its products include DepoCyt®, a treatment
for a lymphomatous meningitis, and DepoDur™ for post operative pain.
The ordinary shares in the Placing have not been and will not be registered
under the US Securities Act of 1933 and may not be offered or sold in the United
States absent registration or an applicable exemption from registration
requirements.
Frank Condella, SkyePharma's Chief Executive, said:
"At the beginning of 2006, we set out several objectives including: the
licensing of Flutiform™, our key inhalation product, and the disposal of our
Injectable Business.
"In May and September we outlicensed Flutiform™ in the US and Europe,
respectively. Today we are announcing the planned sale of the Injectable
Business for an initial consideration of US$20 million together with contingency
milestone and sales-related payments which could be substantial if
DepoBupivacaine™ fulfils its potential under the new ownership.
"The proposed Disposal will relieve the Company of a significant cash burn due
to operating losses and the potential costs of future development and capital
expenditure of the Injectable Business.
"The Disposal, Placing and Paul Capital Refinancing, along with the GBP35
million CRC Financing announced on 27 December 2006, will put SkyePharma in a
good position to build future value by further developing our strategic oral and
inhalation products."
Certain statements in this news release are forward-looking statements and are
made in reliance on the safe harbour provisions of the US Private Securities
Litigation Act of 1995. Although SkyePharma believes that the expectations
reflected in these forward-looking statements are reasonable, it can give no
assurance that these expectations will materialize. Because the expectations are
subject to risks and uncertainties, actual results may vary significantly from
those expressed or implied by the forward-looking statements based upon a number
of factors, which are described in SkyePharma's 20-F and other documents on file
with the US Securities and Exchange Commission. Factors that could cause
differences between actual results and those implied by the forward-looking
statements contained in this news release include, without limitation, risks
related to the development of new products, risks related to obtaining and
maintaining regulatory approval for existing, new or expanded indications of
existing and new products, risks related to SkyePharma's ability to manufacture
products on a large scale or at all, risks related to SkyePharma's and its
marketing partners' ability to market products on a large scale to maintain or
expand market share in the face of changes in customer requirements, competition
and technological change, risks related to regulatory compliance, the risk of
product liability claims, risks related to the ownership and use of intellectual
property, and risks related to SkyePharma's ability to manage growth. SkyePharma
undertakes no obligation to revise or update any such forward-looking statement
to reflect events or circumstances after the date of this release.
The information contained herein does not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of the securities
referred to herein in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration, exemption from registration or
qualification under the securities laws of any jurisdiction.
These materials are not an offer for sale of securities in the United States.
Securities may not be sold in the United States absent registration or an
exemption from registration under the US Securities Act of 1933. The Company
does not intend to register any portion of such offering in the United States or
to conduct a public offering of the ordinary shares in the United States.
For further information please contact:
SkyePharma PLC +44 207 491 1777
Frank Condella, Chief until noon GMT: +44 207 466 5000
Executive Officer
thereafter: +44 207 491 1777
Ken Cunningham, Chief
Operating Officer
Peter Grant, Finance until noon GMT: +44 207 466 5000
Director
thereafter: +44 207 491 1777
Buchanan Communications +44 207 466 5000
(UK)
Tim Anderson / Mark
Court / Rebecca Skye
Dietrich
Trout Group (US)
Seth Lewis +(1) 617-583-1308
NOTES FOR EDITORS
About SkyePharma
SkyePharma PLC develops pharmaceutical products benefiting from world-leading
drug delivery technologies that provide easier-to-use and more effective drug
formulations. There are now eleven approved products incorporating SkyePharma's
technologies in the areas of oral, injectable, inhaled and topical delivery,
supported by advanced solubilisation capabilities. For more information, visit
www.skyepharma.com.
About Blue Acquistion Corp.
Blue Acquisition Corp., a Delaware USA, corporation is controlled and funded by
a group of financial investors including MPM Capital, OrbiMed and Sanderling
Ventures, which led the transaction.
This information is provided by RNS
The company news service from the London Stock Exchange