Acquisition of hungarian distributor and year-end trading update
Cryo-Save Group N.V. (AIM: CRYO, “Cryo-Save” or “the Group”), Europe’s largest adult stem cell storage bank, announces that it is publishing a trading update for the year ended 31 December 2007 and that it has acquired its Hungarian distributor, Sejtbank. Cryo-Save was admitted to AIM on 6 November 2007.
Trading update for the year to 31 December 2007
Cryo-Save has continued to trade in line with the Board’s expectations. During the last quarter of the year, the Group stored more than 6,000 samples for the first time, bringing the total samples stored during 2007 to 20,814, representing a growth of 41% over 2006. The total number of samples stored by the Group is now over 70,000.
Trading has started well this year and the Board remains confident of continuing its strong development during 2008. Cryo-Save remains on track with the scheduled launch of its new products Cryo-Cord+ and Cryo-Lip in 2008.
Acquisition of Hungarian distributor Sejtbank
Cryo-Save has agreed to acquire a 70% interest in its Hungarian distributor Sejtbank Egeszsegugyi Szolgaltato Korlatolt Felelossegu Tarsasag (“Sejtbank”) and Sejtbank’s subsidiary in the Czech Republic, Archiv Bunek s.r.o. (“AB”), for an initial consideration of €3.25 million payable in cash on completion. The vendors have an option to put the outstanding 30% of Sejtbank to Cryo-Save for a sum of €1.4 million plus a performance bonus based on revenue growth.
The terms of the acquisition also provide for the vendors to waive all rights to dividends on the 30% of shares still held by them, in lieu of which they will receive an annual payment of 3% of the combined total revenues of Sejtbank and AB for a maximum of 30 years. Should the put option be exercised, this payment will cease. The total consideration under the agreement has been capped to avoid the need for shareholder approval.
The Directors expect the acquisition to be earnings enhancing with immediate effect and completion is due to be in early March 2008.
As stated at the time of its Admission to AIM, Cryo-Save’s strategy is to broaden and deepen its coverage in both existing and new geographic markets, either by acquisition or in conjunction with a minority partner, while also building on its 50% European market share through effective marketing and new product launches.
Sejtbank is a fast growing, leading Hungarian reseller of the Group’s services that continues to outperform the local market. In 2006 Sejtbank’s reported revenues of €2.3 million and profits before taxation of €0.4 million under Hungarian GAAP. Estimated adjustments prepared under IFRS for financial year 2007 would show revenues of €4.5 million and profits before taxation of €0.6 million.
Cryo-Save has also completed a number of small acquisitions since its Admission. The Group purchased the 30% minority share of its Italian subsidiary Cryo-Save Italia Srl., and completed the acquisitions of Output Pharma Services GmbH and Stemcell GmbH in Germany, enhancing its presence in this growing and important market.
The Group expects to publish its preliminary results for the year to 31 December 2007 during the week commencing 31 March 2007.
For further details
+ 31 (0)575 548998
Rob Koremans, Chief Executive
Arnoud van Tulder, Chief Financial Officer
+ 44 (0) 20 3205 7500
Jos Trusted/Marc Young
+ 44 (0) 20 7457 2020
Adrian Duffield/Jon Davies