EQT is set to acquire FTSE 250 veterinary drug company Dechra Pharmaceuticals in the latest sign of private equity’s growing appetite for London-listed assets.
Dechra’s board said this morning that it is recommending shareholders vote for the Swedish buyout giant’s bid, which marks a 44% premium to the company’s share price before the start of the offer process.
The bid, which includes backing from the Abu Dhabi Investment Authority, values the company at roughly £4.46bn and marks one of the largest deals in Europe so far this year.
Dechra’s share price rose 8% in early morning trading.
Despite a wider slowdown in deals amid uncertainty in the debt markets, PE firms have ramped up their take-private efforts in the UK this year, with almost 30 companies under offer at the end April, according to research from Peel Hunt.
Blackstone kicked off the frenzy with a £700m takeover offer for London-listed commercial property giant Industrials Reit and US PE giant Apollo subsequently made five bids for Aberdeen-based John Wood Group.
READ MORE: FTSE fever grips PE firms as debt markets ‘begin to thaw’
EQT confirmed in April that it had begun talks to acquire the UK vet pharmaceuticals company about the possible all-cash offer.
In May, Dechra then issued a profit warning, saying that full year underlying operating profit for the year ending 30 June 2023 will be below £186m, the guidance it gave in February.
READ MORE: Dechra issues profit warning
“The trading environment during the period January to April 2023 has been more volatile and challenging than anticipated when the board reported its interim results on 27 February 2023,” Dechra said today in a trading statement.
It added: “In the US, the impact of the now widely reported de-stocking by US wholesalers has been deeper and longer than initially expected and had a material impact on Q3 (January to March 2023) performance, although there are encouraging signs that this is now re-bounding.”
READ MORE: Inside PE’s pet boom
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