Abzena acquires TCRS in Bristol, PA

Cambridge, UK | November 24, 2016

Abzena plc, a life sciences group providing services and technologies enabling the development and manufacture of biopharmaceutical products, has conditionally raised £20 million (net of expenses) by way of a placing of 35,004,972 new Ordinary Shares at 60 pence each with certain existing and new shareholders, and has agreed to acquire The Chemistry Research Solution LLC (“TCRS”), subject to certain closing conditions including completion of the placing. The Placing Price represents a 7.7 per cent discount to the closing mid-market price of an existing ordinary share on 23 November 2015, being the last business day prior to this announcement.

TCRS is a specialist contract chemistry and bioconjugation company based near Philadelphia, Pennsylvania, USA, with expertise in producing and analyzing antibody-drug conjugates (ADCs). Abzena will pay $15 million (£10 million) to acquire the entire ownership interests in TCRS. The consideration will be paid as $8.8 million in cash (subject to adjustment for net current assets and retained indebtedness of TCRS at completion of the Acquisition), the issue of 3,609,978 Ordinary Shares and $0.9 million in restricted stock units over 901,697 Ordinary Shares and assumed long term debt of $1.5 million.

Rationale for acquisition of TCRS and use of proceeds

• Will broaden Abzena’s service capability and, with further investment, provide GMP manufacturing capability for ADCs
• Enables ‘Abzena inside’ ADC partner projects to be progressed further through the R&D process by the Group
• Creates new cross-selling opportunities for Abzena’s antibody engineering and biopharmaceutical manufacturing services
• Well established and profitable company; expected to make immediate positive contribution to the Group’s EBITDA
• Establishes another operating presence in the USA, in a key East coast life sciences hub, complementing the West coast location of Abzena company, PacificGMP

Placing proceeds to be used for:

• Acquisition of TCRS & biomanufacturing capital expenditure
• Further research and development in existing Abzena technologies & investment in ‘Abzena inside’ product development
• Additional working capital

Abzena has also today reported its half year results for the six months to 30 September 2015 (please see separate announcement).

Dr John Burt, CEO of Abzena said:
“The acquisition of TCRS is an important strategic step in our ambition to build Abzena into a self-sustaining business and ‘partner of choice’ for R&D organisations developing biopharmaceutical drugs.”

“TCRS is an established, profitable company providing chemistry and conjugation services that complement our own. Bringing TCRS into the Abzena Group will enable wider access to Abzena’s proprietary ADC technologies and, in time, TCRS will be able to provide our partners with larger scale and GMP manufacture.”

“By broadening our service and technology offering with the addition of TCRS to the Group, we are better placed to help our partners develop the next generation of cancer therapies, a fast growing market requiring specialist innovation and differentiation.”

Dr Naresh Jain, Managing Director of TCRS added:
“Joining forces with Abzena has been an easy decision to make. The two companies are very complementary in customer base and the services we offer.

“Adding TCRS and its ADC capabilities to Abzena’s already established offering, puts the enlarged Group in a strong position to meet partners’ needs and, through them, the needs of patients seeking innovative medicines.”

Following the completion of the planned acquisition of TCRS, Dr Naresh Jain will become Senior Vice President (ADC Biomanufacturing) & Global Head of Chemistry for Abzena, reporting to John Burt, Abzena’s CEO.