Announcement of Strategic Deal Conference Call Torbjörn Bjerke, CEO December 21, 2012

Transcription

1 Announcement of Strategic Deal Conference Call Torbjörn Bjerke, CEO December 21, 2012

2 Today s Presentation Overview of the Strategic Deal KDev Investments AB Transaction Details Financial Impact for Karolinska Development About Rosetta Capital Limited Summary 2

3 Summary of the Strategic Deal The deal involves a minority share in 13 holdings in portfolio companies in the Karolinska Development group Karolinska Development s shares in the 13 companies will be transferred to the holding company KDev Investments AB in exchange for common and preference shares Rosetta will invest SEK 110m in acquiring 7.33% of the common shares in KDev Investments and SEK 110m in acquiring all the preference shares from Karolinska Development The portfolio value of KDev Investments at these acquisition prices is SEK 1,500 million, approximately twice the total invested value in that portfolio and a 23 % premium over the reported fair value 3

4 KDev Investment AB Holding company for the co-owned assets of Karolinska Development and Rosetta Investor Will operate to current Karolinska Development business plan for all companies Portfolio selected by Karolinska Development as representative of all assets Both Rosetta and Karolinska Development will support the future follow-on needs of the company KDev Investments AB shareholders 7.33% 92.67% Karolinska Development share Rosetta Investor share 13 companies in the portfolio Biotechnology development and financial experts from Rosetta will be involved in the management of the portfolio together with the Karolinska Development management team 4

5 KDev Investments AB Portfolio PHARMACEUTICALS Concept development Lead discovery Lead optimization Preclinical development Phase I Phase II Phase III Launch ONCOLOGY Axelar AB Aprea AB Akinion Pharmaceuticals AB DERMATOLOGY Pergamum AB (DPK-060, infected eczema) Pergamum AB (DPK-060, external otitis) Pergamum AB (PXL01) Pergamum AB (LL-37) WOMEN S HEALTH Dilafor AB Umecrine Mood AB INFECTIOUS DISEASE Dilaforette AB Biosergen AS INFLAMMATION NovaSAID AB OPHTHALMOLOGY Clanotech AB TECHNOLOGY Concept development Prototype Development Product Sales IMPLANTS Promimic AB PHARMACEUTICAL FORMULATION Inhalation Sciences Sweden AB MEDICAL EQUIPMENT NeoDynamics AB (Fourier/AS) NeoDynamics AB (Therapy/PRFA) 5 Solid colored area = completed phase Shaded colored area = ongoing phase

6 About the Transaction The transaction is in two parts: The transfer of Karolinska Development s holdings in 13 portfolio companies, to a new holding company, KDev Investments AB, in exchange for all 1 million common shares and all 73,300 preference shares Rosetta syndicate vehicle Rosetta Capital IV then acquires 73,300 common shares and 73,300 preference shares At this point, Rosetta will own 7.33% of the common stock and all of the preference stock, representing 13.66% of the capital of KDev Investments AB Karolinska Development will receive the SEK 220m cash consideration in two tranches: SEK 203m on completion of the deal (Closing expected January 31, 2013) SEK 17m from the first SEK 17m return from KDev Investments to Rosetta 6

7 The Preference Shares The preference shares have two functions: They protect Rosetta s investment from significant downside, after KD has received the original SEK 220m They stop providing return at a certain point, limiting Rosetta s upside thereafter to the return from its common share holding The return distribution is as follows: Band Return to Preference Return to Rosetta equity Return to KD Equity Up to SEK 220m 100% Nil Nil Between SEK 220m and SEK 880m 30% 5.1% 64.9% Between 880m and SEK 1,320m 18.33% 6.0% 75.67% Above SEK 1,320m Nil 7.33% 92.67% 7

8 Deal Impact on Karolinska Development Net Asset Value (SEKm) 2500 NAV:2,246 (SEK 46.3 per share) 2000 NAV:1,962 (SEK 40.4 per share) 426 Rosetta syndicate purchase ,217 Cash and short term net assets 1, KDev Investment portfolio Sep 30, 2012 Other Karolinska Development portfolio companies After transaction 8

9 About Rosetta Capital Limited Headquartered in London, United Kingdom Rosetta manages funds of over USD 250m with holdings in more than 25 European and North American portfolio companies Managed by a team of highly experienced individuals in the life science and financial sector Rosetta has a very good track record with high-profile commercial deals with the pharmaceutical industry Recent exits for their investments include GeminX and Enobia 9

10 Summary of the Strategic Deal Validation of the value in our portfolio from high-quality life science investors Involves a minority share in 13 portfolio companies Consideration to be paid by Rosetta is two times Karolinska Development s investment in the same portfolio 23% premium to reported Fair value Net Asset Value per share increases from SEK 40.4 to SEK 46.3 Financial position is significantly strengthened now SEK 500m in cash and short term investments The deal strengthens Karolinska Development considerably in our current and future discussions with industrial partners 10

11 11 Questions