UK Veterinary Drugmaker Dechra Pharma In Discussions With Private Equity For £5B Takeover

Private Equity EQT is discussing a possible takeover offer of a UK veterinary pharmaceutical company Dechra Pharmaceuticals Plc DCHPF DPHAY, sending shares gaining over 30% on Friday morning in response.
Dechra Pharmaceuticals confirmed that it has entered into discussions with the Swedish private equity giant about a possible all-cash offer.
The bid would value Dechra, listed on the FTSE 250, at roughly £4.6 billion.
In February, Dechra said revenue in the six months to December 31, 2022, rose by 14% to £377.4 million, up from £332.4 million a year ago. Pre-tax profit fell sharply to £29.7 million from £53.4 million, as operating profit fell to £44.6 million from £57.4 million a year before.
The firm said it expects full-year underlying operating profit to be at the lower end of analyst expectations.
Dechra's share price hit a record high in August 2021, riding a new wave of demand from pet owners in the wake of the pandemic.
However, the company's share price since halved from its peak almost two years ago.
Dechra said it had confirmed to EQT that it would be prepared to recommend the possible cash offer to its shareholders should the PE firm announce a firm intention to make an offer.
Under the terms of the Possible Offer, Dechra shareholders would receive 4,070 pence per ordinary share in cash.
Founded in 1989 as the National Veterinary Services, a venture capital-funded business, Cheshire-based Dechra floated on the London Stock Exchange in 2000.
Under UK takeover rules, EQT has until May 11 to decide whether to make a firm offer, Dechra said in a statement after the London market's close on Thursday. Abu Dhabi Investment Authority may invest in any deal alongside EQT.

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