Proximagen Neuroscience plc - Reccommended cash offer for Minster Pharmaceuticals plc

04 Jan 2010

Summary

The Boards of Proximagen and Minster are pleased to announce that they have today reached agreement on the terms of a recommended cash offer by Proximagen for the entire issued and to be issued share capital of Minster.

Under the terms of the Offer, Minster Shareholders will receive 6.0 pence in cash for each Minster Share held by them, valuing the entire issued and to be issued share capital of Minster at approximately  £4.3 million.

The Offer represents a premium of approximately 45.45 per cent. to the Closing Price of 4.13 pence per Minster Share on 31 December 2009, being the last dealing day prior to this announcement.

The bases for these calculations are set out in Appendix II to this announcement.

Proximagen is a biopharmaceutical company focused on the development and commercialisation of novel therapeutics for diseases of the central nervous system. In June 2009, Proximagen raised £50 million to pursue its strategy of acquiring attractive drug programmes in its preferred therapeutic area of the central nervous system. Proximagen recently acquired the entire issued share capital of Cambridge Biotechnology Limited and certain other assets from Biovitrum AB which together considerably broadened its portfolio of programmes which now includes clinical stage assets.

Minster is a drug development company focused on neurological and psychiatric disorders. Its principal pipeline assets are tonabersat and sabcomeline. Worldwide rights to both compounds were acquired from GlaxoSmithKline ("GSK") and these compounds benefit from comprehensive safety tolerance data as a result of investment by GSK. Tonabersat is the leading compound in an exciting new class of selective drugs designated as neuronal gap junction blockers. Sabcomeline, a muscarinic partial agonist, has potential in the treatment of cognitive decline in schizophrenia.

The Minster Directors, who have been so advised by Nomura Code Securities, consider the terms of the Offer to be fair and reasonable. In providing advice to the Minster Directors, Nomura Code Securities has taken into account the commercial assessments of the Minster Directors. In addition, the Minster  Directors consider the terms of the Offer to be in the best interests of the Minster Shareholders as a whole.

Accordingly, the Minster Directors unanimously intend to recommend that all Minster Shareholders accept the Offer, as those Minster Directors who hold Minster Shares have irrevocably undertaken to do (or procure to be done) in respect of each of their own respective beneficial holdings of Minster Shares amounting, in aggregate, to 14,431,957 Minster Shares, representing approximately 24.50 per cent. of the existing issued share capital of Minster.

In addition, further irrevocable undertakings to accept the Offer have been secured by Proximagen in respect of, in aggregate, 18,460,096 Minster Shares, representing approximately 31.34 per cent. of  Minster's existing issued share capital.

Accordingly, irrevocable undertakings to accept (or procure the acceptance of) the Offer have been received in respect of, in aggregate, 32,892,053 Minster Shares, representing approximately 55.84 per cent. of Minster's existing issued share capital.

The Offer Document containing the formal terms of, and Conditions to, the Offer will be posted to Minster Shareholders in due course and, in any event, within 28 days following the date of this announcement.

Commenting on the Offer, John Russell, Chairman and CEO of Minster, said: "The Offer represents a good premium to the share price and the Minster Board is pleased to recommend it to shareholders. Following the announcement of the TEMPUS study last year, the Minster  Board has explored a number of options for extracting maximum value for shareholders. We believe  the Offer provides a more certain investment outcome for shareholders since the prospects for Minster, without the funding it needs to progress its business plan, are extremely uncertain."

Commenting on the Offer, Dr. Kenneth Mulvany, CEO of Proximagen, said: "We are delighted to announce the Offer for Minster Pharmaceuticals. We are particularly interested in Minster's compound, tonabersat, which we believe has potential for the treatment of epilepsy, one of the most common of the serious neurological disorders."

Evolution Securities is acting as financial adviser to Proximagen. Nomura Code Securities is acting as financial adviser to Minster.

Enquiries:

For Proximagen:
Proximagen Neuroscience plc
 Phone: +44 (0)20 7848 6938
 Kenneth Mulvany, Chief Executive Officer  
 James Hunter, Finance Director
Buchanan Communications
 Phone: +44 (0)20 7466 5000
 Tim Anderson, Catherine Breen
 Evolution Securities Limited (NOMAD)
 Phone: +44 (0)20 7071 4300
 Stuart Andrews, Bobbie Hilliam, Tim Redfern

For Minster:
 Minster Pharmaceuticals plc
 Phone: +44 (0)20 7936 9921
 John Russell, Chairman and Interim CEO
 Karl Keegan, Chief Financial Officer
 Buchanan Communications
 Phone: +44 (0)20 7466 5000
 Mark Court
Nomura Code Securities Limited (Rule 3 Advisers & NOMAD)
 Phone: +44 (0)20 7776 1200
Richard Potts, Giles Balleny

The above summary should be read in conjunction with, and is subject to, the full text of this announcement (including its Appendices). Appendix I to this announcement contains the Conditions and certain terms of the Offer. Appendix II to this announcement contains further details of the bases of calculations and sources of information set out in this announcement. Terms used in the summary have the meaning given to them in Appendix III to this announcement.

This announcement does not constitute the Offer. The Offer will be made solely through the Offer Document which will contain the full terms of and conditions to the Offer (including details on how to accept the Offer). Any response in relation to the Offer should be made only on the basis of the information contained in the Offer Document or any other document by which the Offer is made.

The full text of this announcement is available via RNS.

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