Horizon Discovery shares dive as Abcam decides not to bid
Abcam has decided not to go hostile with a bid for Cambridge UK life sciences neighbour Horizon Discovery whose share price took an immediate hit.
Abcam’s share price half an hour after the announcement was down slightly to 1,237p per share while Horizon’s stock plummeted almost 16 per cent and 29.50 p to 156.50 before recovering slightly.
The Abcam board says it remains keen on strategic acquisitions but only at the right price – and that Horizon no longer fits into that bracket.
Abcam revealed last week that it had made a proposal to Horizon, a world leader in gene editing technology, but that the target business had declined to engage. Its proposal valued Horizon at 181 pence per share and reflected Abcam’s strong interest in pursuing strategic expansion in the gene editing market, which the directors believed to be highly complementary to its supply of research tools globally.
Horizon rejected the advance and has since issued a strong set of preliminary results for the year to December 31 which have convinced Abcam to step aside and not to pursue what would have been a hostile bid.
A statement issued by Abcam to the London Stock Exchange today said: “Abcam continues to execute on its vision to be the most influential life science company for researchers worldwide and remains committed to expanding its reach and influence globally.
“However, it has always been Abcam’s intention to remain disciplined about value whilst working towards a transaction with the recommendation of the board of Horizon Discovery.
“On 8 May, Horizon published its preliminary results for the year. Having considered those results and Horizon’s view that there is little strategic rationale to combining the two companies, Abcam confirms that it does not intend to make an offer for Horizon Discovery.”
The Horizon share price has been volatile since CEO Darrin Disley (pictured above) quit earlier this year. In the wake of his departure the stock fell from 240p to 200p and then dived 30 per cent to the point when Abcam felt 181p per share respresented good value for a takeover.
Horizon’s stock rose again when shareholders thought Abcam would make a bid but today’s announcement put the skids under the share price revival.