Big Swiss Purchase For UK's SkyePharma

Privately-owned Swiss drug delivery firm Jago Holding AG is to be acquired by the UK company SkyePharma plc for L104.8 million (L160.9 million) in cash and L22.9 million ($35.5 million) in shares. The latter was was set up last year by Australian entrepreneur Ian Gowrie-Smith taking a controlling stake in loss-making marquee hiring firm Black & Edgington (Marketletters passim); Mr Gowrie-Smith first established Medirace, which in turn became Medeva, and from which he subsequently pulled out.

The deal also provides for deferred considerations comprising earn-out payments based primarily on 20% of the future royalty receipts of Jago over the next 10 years, subject to a minimum annual royalty threshold of $30 million. The maximum cash amount payable under the earn-out is $250 million. Further amounts of up to $10 million in total may be payable in due course in connection with certain contractual rights of Jago.

SBC Warburg is acting as sole financial adviser to SkyePharma, bookrunner for a proposed L135 million placing and open offer and will be the sponsor for the proposed introduction of the firm to the London Stock Exchange Official List.