British pharmaceuticals firm Clinigen today agreed to buy smaller Aim-listed rival Quantum Pharma for £150.3m.
Clinigen, which specialises in the supply of unlicensed medicines to doctors and hospitals, said the acquisition will put it in a stronger position to drive its global expansion.
Under the deal, Quantum shareholders will receive 37p in cash and 0.0405 new Clinigen shares for each Quantum share held.
Based on Clinigen's closing price yesterday of 1,111p, that values each Quantum share at 82p.
Quantum's shares jumped more than 19 per cent on the news. At the time of writing, shares were up 17.16 per cent at 78.5p. Clinigen's shares dropped 4.52 per cent to 1,063p.
"The earnings enhancing acquisition of Quantum is an excellent operational and geographical, as well as cultural, fit with Clinigen," said Shaun Chilton, chief executive of the pharma group.
"With the addition of Quantum, we will be in a stronger position to drive our global expansion in the unlicensed and commercial medicine markets."
Quantum, which floated in 2014 with a valuation of £125m, brought in new management in 2016 following a period of poor performance. For the six months to the end of July, the firm reported revenue from continuing operations of £36.2m.
Chris Rigg, the boss of Quantum said the two firms were a good strategic fit.
"As part of the Clinigen Group, Quantum will be able to drive faster strategic growth and gain immediate access to international markets that will complement our existing product portfolio, provide additional routes to market for our development pipeline and accelerate the group's strategic plan," he said.