CELLINK has entered into an agreement with the owners of Scienion, a German life science company focusing on precision dispensing technologies, to acquire all shares for a purchase price on cash- and debt-free basis of 80M euros (the “Acquisition”). 40M euros will be paid in 2,814,032 newly issued shares of series B in CELLINK (the “Consideration Shares”) and the reminder in cash. CELLINK’s Board of Directors will resolve to issue the Consideration Shares in accordance with the authorization from the Annual General Meeting held on December 18, 2019. CELLINK also contemplates to explore the conditions for raising additional equity through one directed share issue within the limit of CELLINK’s existing authorization to issue shares from the Extraordinary General Meeting held on July 16, 2020.
The transaction in brief
· Scienion is a life science company focusing on precision dispensing technologies. Scienion was founded in 2001 and has since become a actor in the pico and nano liter dispensing market including single cell dispensing.
· The total purchase price for 100 percent of Scienion’s shares on cash- and debt-free basis amounts to 80M euros, 40M euros will be paid in cash and 40M euros will be paid by newly issued CELLINK shares of series B at a price of 146.6 SEK per share, translating to 2,814,032 shares and corresponding to approximately 4.9 percent of the votes and approximately 6.5 percent of the share capital in CELLINK.
· The Consideration Shares will be covered by lock-up agreements with partial release every 6 months after an initial 12-month period. The total lock-up period for the sellers is between 30 and 36 months.
· Through Scienion’s complementary technology offering, CELLINK sees great synergies that will support future growth. Scienion’s revenue reached 21.5M euros during 2019 with an EBITDA margin of 23.6 percent and a 3-year revenue CAGR of 34 percent. Due to the Covid-19 pandemic, while pro-forma revenue growth is expected for 2020, Scienion’s growth rate is likely to be temporarily and negatively impacted compared to 2019. However, a large portion of the existing common customer base is directly or indirectly government backed (universities, research), mitigating the impact of the Covid-19 pandemic.
· The Acquisition is in line with CELLINK’s commercial strategy, strengthening CELLINK’s product offering and brings the closer to the patient through products used in diagnostics on humans. The Acquisition will support future growth into industrial and clinical applications.
· The Acquisition’s completion and the transfer of Scienion’s shares is expected to take place by the end of August 2020, provided that all conditions for completion are met.
· Scienion will remain under current entity and management post-transaction.
· Scienion will be consolidated in CELLINK’s financial statements for approximately 3 days during CELLINK’s fourth quarter 2019/2020.
· CELLINK’s Board of Directors will resolve on an issue in kind of the Consideration Shares in accordance with the authorization from the annual general meeting held on December 18, 2019.
“We are excited to welcome Scienion to the CELLINK family of life-science companies with this strategic and synergistic acquisition. With this acquisition, we are further realizing CELLINK’s vision to create the future of medicine by taking one step closer to the clinic and improving health around the world. Scienion has diligently built a globally position in the field of precision dispensing, creating a product portfolio with industrial systems that are capable of extremely precise dispensing of reagents and human cells. Many of these systems are being used for the manufacturing of clinically approved devices used by patients around the globe. We are furthering CELLINK’s global commercial strategy by focusing on the patient by providing the most innovative solutions to our customers. With Scienion’s revolutionary technology platforms, we will streamline workflows for our present and future customers, and enhance our presence in the clinical field, a strategy that is well aligned with our long-term vision. Together with Dispendix, cytena, and Scienion, we will be well-positioned to offer comprehensive solutions for academic, pharmaceutical, and clinical customers worldwide.” Erik Gatenholm, CEO, CELLINK.
“We are thrilled about the unique opportunities this combination will create for our customers worldwide, as well as our employees and business partners. Together, the CELLINK and Scienion will be able to achieve rapid expansion while delivering the quality, brands and products that our customers love. Together we will have some of the most respected, recognized and storied brands in the global life science industry, and together we will create an even brighter future.” Dr. Holger Eickhoff, CEO, Scienion.
Scienion is a life science company focusing on precision dispensing technologies. Scienion was founded in 2001 and has since become a actor in the pico and nano liter dispensing market, including single cell dispensing. Scienion develops and manufactures technologies enabling precision dispensing for applications such as Biosensors POC used for diabetes monitoring, Micro and Nano arrays, Diagnostics, compound handling and high throughput single cell genomics. Its instruments, consumables, and contract manufacturing services are produced and offered in Germany and are marketed and delivered worldwide.
Background and motivation for the Acquisition
Through this strategic Acquisition, CELLINK expands its technology portfolio, supporting further expansion into the pharmaceutical industry and therapeutic field. With this Acquisition, CELLINK will be able to cater for processes from early R&D to standardized high throughput production. The complimentary product portfolio will together with the current offering position CELLINK as a market leader in precision dispensing, single cell handling and Bioprinting. Scienion’s business model resembles CELLINK with a consumable focus driven by innovative instrumentation. Scienion’s products are most suitable for diagnostics and pharmaceutical companies, an area and market which CELLINK is expanding further into. With this Acquisition, CELLINK aims to increase market penetration in the pharmaceutical field and meeting the diagnostics field.
Scienion’s product range offers picoliter dispensing and enables complete manufacturing workflows, being an ideal partner to scale from R&D to manufacturing. The companies’ synergies enable greater market opportunities for CELLINK’s and Scienion’s product portfolio and global sales forces. The products are well-suited to be sold together with CELLINK’s existing customer base. Scienion will remain under current entity and management post-transaction.
Purchase price and financing of the acquisition and lock-up period
The total purchase price of 100 percent of Scienion’s shares on cash- and debt-free basis amounts to 80M euros, 40M euros will be paid in cash and 40M euros will be paid by the issue of the 2,814,032 Consideration Shares at closing. The Consideration Shares will be covered by lock-up agreements with partial release every 6 months after an initial 12-month period. The total lock-up period for the sellers is between 30 and 36 months.
Issue of Consideration Shares
CELLINK’s Board of Directors will resolve to issue the Consideration Shares in accordance with the authorization from the annual general meeting held on December 18, 2019.The Consideration Shares represent approximately 4,9 percent and approximately 6.5 percent of the total number of shares and votes in CELLINK, respectively, on a fully diluted basis. By issuing the Consideration Shares, the number of shares and votes increase by 2,814,032 (divided among 1,500,000 shares of series A and 44,188,808 shares of series B). The share capital increases by approximately SEK 70,350.8 from approximately SEK 1,071,896.4 to approximately SEK 1,142,220.2.
The Consideration Shares are issued at a price of SEK 146.6 per share, which equals the 90 day volume weighted average price of CELLINK shares of series B on Stockholm up to and including August 18, 2020, and using the FX rate EUR/SEK of 10,31 per August 18, 2020.
The Acquisition’s completion and the transfer of Scienions shares is expected to take place by the end of August 2020 provided that all conditions for completion are met.