Omega creates new deal

Omega Diagnostics Group (Omega), a medical diagnostic company, has acquired Genesis Diagnostics and Cambridge Nutritional Sciences (Genesis-CNS) for an initial £5.7 million.


Omega Diagnostics Group (Omega), a medical diagnostic company, has acquired Genesis Diagnostics and Cambridge Nutritional Sciences (Genesis-CNS) for an initial £5.7 million.

Omega Diagnostics Group (Omega), a medical diagnostic company, has acquired Genesis Diagnostics and Cambridge Nutritional Sciences (Genesis-CNS) for an initial £5.7 million.

 

The £5.7 million consisted of £3.2 million cash, which is some £2.9 million net of the cash on Genesis CNS’ balance sheet.

 

Genesis-CNS supplies test kits to hospital laboratories in the UK and overseas via a network of distributors in 27 countries.

 

The deal also consists of the issue of more than 4.4 million shares at the placing price and an amount in cash of £61,634 payable one year after completion as well as the issue of a loan note worth £1.1 million on completion.

 

Genesis-CNS also offers food intolerance test services to healthcare practitioners and has developed a home test kit for food intolerance which has received the CE mark and can be sold to consumers directly.

 

Further to the announcement, the company’s issued share capital now consists of some 14.8 million new ordinary shares of 4p each.

 

In order to fund the acquisition the company raised £2.2 million by means of a placing of 7.3 million new ordinary shares at 30p by Landsbanki Securities. A further £1.2 million of funding for the acquisition has been provided by a loan from Bank of Scotland.

 

A senior partner at law firm Kester Cunningham John, Fiona Roberts, was recommended to Omega for her reputation on similar deals in the Cambridge area.

 

Fiona led the legal side of the transaction assisted by colleagues in the firm’s corporate, employment and property teams. A firm of solicitors in Gibraltor also assisted, acting for an off shore Trust.

 

Roberts said: “The consideration structure was pretty complicated and with a business such as this intellectual property issues were key. Genesis was established in 1994 and CNS in 2001, serving 27 countries in the clinical diagnostics market. I believe Omega’s distribution network extends to 100 countries so the potential to increase sales is obvious.’ 

 

Ernst & Young was reporting accountant and provided financial and tax due diligence services to the acquirer and the debt funder.

 

The team was led by transaction support director Luke Charleton and involved a team from the transaction support, audit and tax departments. Omega was an existing client of the firm.

 

Marc Barber

Raven Connelly

Marc was editor of GrowthBusiness from 2006 to 2010. He specialised in writing about entrepreneurs, private equity and venture capital, mid-market M&A, small caps and high-growth businesses.

Related Topics

Venture capital funding