TIDMANCR
RNS Number : 2216A
Animalcare Group PLC
28 September 2020
Animalcare and Kane Biotech to form animal health company to
target biofilm-related ailments
Animalcare to invest CA$5 million, consisting of CA$3 million to
acquire one-third stake in STEM Animal Health, Kane Biotech's new
animal health subsidiary, and a further CA$2 million for rights to
commercialise products in global veterinary markets outside of the
Americas
Animalcare to launch biofilm oral care range for Companion
Animals in European and Asian markets
28 September 2020. Animalcare Group PLC (AIM:ANCR) today
announced that it has entered into an agreement with Canada-based
biotech company Kane Biotech Inc. (TSX-V:KNE; OTCQB:KNBIF) under
which the parties will form STEM Animal Health Inc. ("STEM"), a
company dedicated to treating biofilm-related ailments in
animals.
The agreement will see Animalcare commercialise Kane Biotech's
range of oral care products for companion animals in European and
Asian markets and collaborate on the development of new biofilm
treatments for animals.
Under the terms of the deal, Kane Biotech will create a new
subsidiary, STEM, in which Animalcare will invest CA$3 million in
installments over a period of 48 months to acquire, on entering
into the agreement, a one-third plus one share equity interest.
STEM will be established with a global license over Kane Biotech's
existing range of animal health oral care products and in
collaboration with Animalcare will also focus on the research and
development of novel animal treatments based on biofilm targeting
technology. Animalcare will have licensing rights over future STEM
products in Europe and Asia and the option, for a period of six
years, to acquire an additional one-sixth stake in the subsidiary
for CA$4 million, payable to Kane.
STEM is designed to be self-financing from day one and will
benefit from revenues already being generated in the US, Canada and
South America as well as from Europe and Asia.
Additionally, in exchange for Animalcare receiving the right to
commercialise Kane's coactiv+TM and DispersinB(R) products in
global veterinary markets outside the Americas, Animalcare will
provide an upfront payment to Kane Biotech along with a series of
potential payments linked to various commercial milestones to a
combined maximum of CA$2 million ("Licensing Fee") as well as
ongoing royalties.
Animalcare intends to start commercialising Kane Biotech's range
of oral care products in the second half of 2021 and expects the
agreement to be earnings enhancing in 2022. The equity investment
by Animalcare in STEM and the Licensing Fee are expected to be paid
from existing cash resources.
Jenny Winter, Chief Executive Officer of Animalcare commented:
"Our collaboration will bring the benefits of Kane Biotech's
anti-biofilm oral and skin care technology to more animals and
their owners in more countries around the world. The agreement
complements Animalcare's existing portfolio and drives our future
growth strategy by leveraging the Group's knowledge of our
veterinary markets while combining our expertise and resources with
Kane Biotech to develop new, differentiated and much-needed
solutions to prevent and treat infections.
"The creative structure of the deal befits Kane Biotech's
innovative biofilm technology and underlines the commitment of both
parties to a long-term sustainable commercial relationship."
Marc Edwards, President and Chief Executive Officer of Kane
Biotech said: "We are very excited to partner with Animalcare to
establish an animal health company dedicated to treating biofilms,
while further expanding our footprint globally. This agreement
provides STEM Animal Health, Kane Biotech's first commercialisation
vehicle, with capital at a valuation that is highly attractive and
non-dilutive to existing Kane shareholders. This will accelerate
our product development and commercialisation globally and is a
major step towards defining Kane Biotech as the preeminent global
leader in biofilm research and product development. In the months
to come, we plan on establishing additional commercialisation
vehicles for both our wound care and our consumer goods
businesses.
"Animalcare has more than 30 years of experience successfully
developing, launching and marketing animal health products, so we
believe this agreement provides further validation of the strength
of our animal health product portfolio and the anti-biofilm
technology on which it is based. In addition to Animalcare's many
years of commercial success, its strong relationships with
veterinary professionals and focus on customer service makes
Animalcare an ideal partner."
The closing of the transactions referenced herein remain subject
to the final approval of the TSX Venture Exchange.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014.
NOTES TO EDITORS
About biofilms
Biofilms are formed when bacteria or yeast adhere to surfaces
and excrete a resin-like substance that acts as an anchor and
provides protection from external factors such as host immune
system defenses and antifungal or antibacterial drugs. Biofilms can
make bacteria up to 1,000 times more resistant to antibiotics,
disinfectants and the host immune system. The anti-biofilm
technologies developed by Kane Biotech are designed to prevent and
remove biofilms and have a positive impact on human, animal and
environmental health through antimicrobial stewardship.
Analyst briefing
A briefing for analysts on publication of the Group's Interim
Report will be held at 10:30 BST on Tuesday 29 September via
teleconference. Analysts wishing to join should contact
InvestorRelations@panmure.com
About Animalcare
Animalcare Group PLC is a UK AIM-listed international veterinary
sales and marketing organisation. Animalcare operates in seven
countries and exports to approximately 32 countries in Europe and a
further 16 worldwide. The Group is focused on bringing new and
innovative products to market through its own development pipeline,
partnerships and via acquisition.
For more information about Animalcare, please visit
www.animalcaregroup.com or contact
Animalcare
Jenny Winter, Chief Executive Officer +44 (0)1904 487 687
Chris Brewster, Chief Financial
Officer communications@animalcaregroup.com
Media relations
Panmure Gordon (Nominated Adviser
& Broker)
Corporate Finance
Freddy Crossley/Emma Earl
Corporate Broking
Rupert Dearden +44 (0)20 7886 2500
About Kane Biotech Inc.
Kane Biotech is a biotechnology company engaged in the research,
development and commercialization of technologies and products that
prevent and remove microbial biofilms. Kane Biotech has a portfolio
of biotechnologies, intellectual property (52 patents and patents
pending, trade secrets and trademarks) and products developed by
Kane Biotech's own biofilm research expertise and acquired from
leading research institutions. StrixNB(TM), DispersinB(R),
Aledex(R), bluestem(TM), silkstem(TM), coactiv+(TM) and Kane(R) are
trademarks of Kane Biotech Inc. Kane Biotech is listed on the TSX
Venture Exchange under the symbol "KNE" and on OTCQB Markets under
the symbol "KNBIF".
For more information, please visit www.kanebiotech.com or
contact:
Marc Edwards +1 (514) 910-6991
Chief Executive Officer, Kane Biotech medwards@kanebiotech.com
Inc.
+1 (204) 298-2200
Ray Dupuis rdupuis@kanebiotech.com
Chief Financial Officer, Kane Biotech
Inc. + 1 (416) 842-9003
graham.farrell@harboraccessllc.com
Graham Farrell
Investor Relations
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END
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