Glasgow’s Collagen Solutions agrees to £30m takeover

Collagen Solutions CEO Jamal Rushdy

Glasgow-based Collagen Solutions has agreed a 6.5p per share cash takeover offer from its largest shareholder Rosen’s Diversified Inc. (RDI) that values the Scottish firm at around £30.4 million.

The offer price agreed on Thursday represents a premium of 160% to the closing price of 2.50p on Wednesday and a premium of 441% to the closing price of 1.20p on April 15, the last business day prior to the start of a formal sale process.

Including its own stake in Collagen, Minnesota-based RDI said it now either owns or has received irrevocable undertakings for the deal representing around 61% of Collagen’s existing share capital. It needs 75%.

Collagen Solutions chairman Chris Brinsmead said: “Collagen has built a high-performance team and significant portfolio of customers and projects, well positioning the company in the exciting regenerative biomaterials and tissue market.

“The offer from RDI recognises this strategic value and provides an attractive opportunity for shareholders to realise immediate value at a significant revenue multiple and premium to both the historical and prevailing share price.”

Collagen Solutions CEO Jamal Rushdy said: “We believe RDI offers a compelling fit for Collagen, offering expanded opportunities for our employees, and a solid financial backing and broader offering to benefit our customers.

“We appreciate RDI’s recognition of the value of our global workforce and infrastructure as key to the continued success and growth of the company.”

RDI director Wade Rosen said: “RDI’s acquisition of Collagen, when integrated with SLS, will create a business of significant scale in the tissue supply and engineering space.

“With highly complementary offerings and capabilities, the combination will reinforce SLS’s already robust position in the North American market, while Collagen’s international presence will also provide a strong platform for the enlarged group to extend its supply of porcine and bovine tissue into the EMEA and APAC regions; taken together, we expect this to accelerate future growth and value creation while enhancing opportunities for employees of both entities.

“While we recognise that the board of collagen had to undertake the formal sale process in order to maximise shareholder value, we have always felt that we are the best partner for the company.

“We are, therefore, looking forward to the offer completing as soon as practicable, such that we can then fully welcome the company and its team members into the RDI organisation.

“Our recommended offer also provides Collagen shareholders with the certainty of a cash exit, in full, at a substantial and attractive premium over the prevailing value of their Collagen Shares at a time of considerable global macroeconomic uncertainty.”