Apiam make $16m animal vaccine move
Veterinary services business Apiam is launching a $16 million move to tap into the fast-growing animal vaccine and diagnostics market.
Apiam announced on Tuesday it had reached a binding agreement to acquire vaccine developer ACE Laboratory Services.
Managing director Chris Richards hailed the deal as big step in Apiam's expansion plans.
"The acquisition of ACE Laboratory Services is highly compelling for Apiam, delivering an immediate and established position into a highly specialised and attractive business segment," Dr Richards said in a statement.
Investors seemed to agree, sending Apiam shares 5.68 per cent higher to 44 cents by 1434 AEST.
ACE Laboratory Services works with large pig, cattle, sheep and poultry producers across Australia as the nation's largest bespoke vaccine and production animal diagnostic laboratory.
They banked $6.5 million in revenue over the 2018/19 financial year, a result that didn't go unnoticed at Apiam.
"The track record of ACE Laboratory Services in terms of performance and innovation is world class," Dr Richards said.
"We believe there are many growth opportunities as trends in farming evolve, especially with demand for alternatives to antimicrobials growing rapidly."
Apiam says custom vaccines are an attractive alternative to sometimes less-effective commercial varieties, while production animal diagnostics is another practice trending upwards.
Of the $16 million total consideration, $12.375 million in cash and shares will initially change hands with the rest payable in 12 months subject to performance thresholds.
The two companies are targeting to finalise the acquisition by September 30.
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