Disposal of non-core assets
Disposal of non-core ECOmectin product licences in Southern Africa for £491,000 consideration.
- Disposal consideration £491,000
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ECO Animal Health Group plc (AIM: EAH), a rapidly growing global animal health company with a portfolio of marketed veterinary products and a maturing proprietary R&D pipeline, today announces the disposal of certain non-core product lines to its distribution partner in South Africa for a total consideration of £491,000 (the "Transaction").
Continuing to streamline the business
ECO is focused on treatment and prevention of disease in pigs and poultry. The ECOmectin licences disposed of in the Transaction are for use in sheep and cattle and include a range of anti-parasitic treatments and have for some time been non-core to ECO. All licences are specific to Southern Africa (South Africa, Botswana, Namibia and Zambia). ECO's distribution partner has manufactured and sold these products under licence for over 20 years and royalties were paid to ECO.
The Transaction
Consideration of £491,000 was received in lieu of pro-rata past and future royalties. Nil royalties were recorded in the year ended 31 March 2024.
Reinvesting to support our pipeline
The Board believes that the Transaction further streamlines ECO's focus on its core species of pigs and poultry and in particular on developing its highly innovative pipeline of vaccines and preventatives. It is intended that the funds received from the Transaction will be partly invested in research and development to support new product development. It is also intended that, subject to shareholder approval, a portion of the consideration will be used in a share buy-back to satisfy the future potential vesting of employee share incentives.
David Hallas, Chief Executive Officer of ECO Animal Health Group plc, commented: "The disposal of these non-core assets aligns with our focus on swine and poultry and our commitment to invest in our R&D pipeline. We are pleased that the licences will be further developed by a committed owner.
"We continue to look for value accretive licensing opportunities both within our portfolio and outside and for opportunities to reinvest in the R&D pipeline to support future growth."
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