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Original Source: FD (FAIR DISCLOSURE) WIRE
. Dean Linden, ID Biomedical Corp., Assoc. Dir., Corp. Comm. . Todd Patrick, ID Biomedical Corp., President . Dr. Tony Holler, ID Biomedical Corp., CEO . Jennifer Chao, Deutsche Bank, Analyst . David Dean, Sprott Securities, Analyst . Philippa Flint, RBC Capital Markets, Analyst . Matt Geller, CIBC, Analyst . Michael Brown, Enterprise Management, Analyst . Claude Camire, Paradigm Capital, Analyst . Russell Gilbertson, Davis & Co., Analyst . David Miller, Biotech Monthly, Analyst
ID Biomedical and GSK announced today an acquisition of all of the outstanding shares or securities of ID Biomedical in an all cash transaction. The purchase price is Can$35 per share. Q&A Focus: Valuation, third-party bid, specifics of price.
A. Key Data From Call 1. Total purchase price = approx. Can$1.7b.
S1. Acquisition Details (T.P.) 1. Acquisition: 1. ID Biomedical (IDBE) and GSK announced today an acquisition of all of the outstanding shares or securities of IDBE. 1. This is an all cash transaction. 2. The purchase price is Can$35 per share. 1. Based on current exchange rate, as of 09/06/05 close, $29.49 per share. 3. The total purchase price is approx. Can$1.7b. 1. $1.43b. 4. GSK is also assuming all of IDBE's debt. 2. Agreement Details: 1. The transaction is subject to certain closing conditions,
namely a favorable vote by IDBE shareholders and various US
and Canadian government consent. 2. IDBE expects to close the transaction by early 2006. 3. The transaction requires court approval of the acquisition and takes into account the fairness of the terms of the acquisition to the co.'s security holders.
1. IDBE will obtain security holder approval prior to the closing of the transaction, and expects to hold a security holders meeting in Nov. 2005. 4. The combination agreement contains customary provisions
relative to any potential third-party acquisition proposal.
1. Such as allowing IDBE to accept a superior proposal from a
third-party upon payment of a termination fee to GSK. 5. The combination agreement also allows GSK to match a superior proposal.
6. In addition to the combination agreement, the parties have
also entered into a credit facility agreement whereby GSK has
agreed to loan IDBE up to $120m. 1. This loan is unsecured and carries an interest rate of 7%. 2. Proceeds from the loan will be used by IDBE to repay its $60m with Second City Capital Partners, as well as to finance ongoing Opex and Capex during the period from now to closing. 3. The maturity date on the loan matches the time required to close the transaction or 90 days after any termination of the combination agreement.
S2. Strategic Rationale (T.H.) 1. History: 1. In 2001, IDBE acquired a small private co. called Intellivax. 1. In that transaction, purchased the technology that has the potential to create an intranasal flu vaccine. 2. At that time, the co.'s only vaccine program in clinical development was the StreptAvax vaccine. 3. The transaction was important as IDBE reduced risk by diversifying its product portfolio. 4. The co. now has two clinical programs.
5. In that transaction, IDBE also added expertise in research
and clinical and regulatory development. 2. In 2004, IDBE acquired the vaccine assets of Shire Pharmaceuticals PLC. 1. This transaction provided the co. with an injectable flu vaccine that was approved in Canada. 2. Also, modern facilities to manufacture flu vaccine, a pipeline of vaccines in various stages of development, and further added to expertise in quality assurance, …