Redx set to be acquired by US investor Redmile

Redx Pharma is set to be acquired by its, now, biggest shareholder, Redmile.

This morning the Alderley Park drugs discovery firm revealed that Yesod had made a second takeover approach for the company, having backed out of a previous approach on February 28.

Shortly after, US-based Redmile, which agreed a £26.3m funding injection for Redx on February 28, after Yesod’s withdrawal, announced it had bought 39.5% of the total Redx shares from Moulton Goodies, at a price of 15.5p per share.

This takes Redmile’s total holding to 45.5%.

Under the Takeover Code, Redmile is now required to make a mandatory cash offer for the Redx shares not already held or agreed to be acquired by Redmile, at a price of 15.5p.

Redx directors intend to recommend unanimously that Redx shareholders accept the offer, which values the entire issued, and to be issued share capital of Redx, at approximately £29.45m.

Iain Ross, Redx chairman, said: “Redx, with its deep expertise in medicinal chemistry, has a proven track record of designing high quality, commercially attractive molecules that have the potential to be effective drugs to treat significant unmet medical conditions.

“As previously announced, the board has been seeking to secure long-term finance for Redx.

“We believe that this cash offer represents an optimal outcome for shareholders, while securing Redx’s ability to fund its differentiated and exciting research and early development pipeline.”

Jeremy Green, founder and portfolio manager of the Redmile Group, said: “We are excited to partner with Redx.

“We believe the company’s medicinal chemistry and drug development expertise and existing pipeline creates a strong foundation to build a leading biotechnology company focused on therapeutic areas with significant unmet medical need.

“With a focused development strategy and sufficient capital to execute, we anticipate management will be able to advance multiple programs through clinical trials to characterise the potential of its pipeline.

“Our investment in Redx is a clear sign of our belief in the company, its management team, and its strategy.”