KKR launches US$1.2 B bid for Swedish biotech company Biotage

SWEDEN—Global investment firm KKR has made a significant move in the life sciences sector by offering to acquire all outstanding shares of Swedish company Biotage for 11.6 billion Swedish kronor (US$1.2 billion).

The offer, made through KKR’s newly established entity RWK BidCo, proposes a cash payment of 145 kronor (US$13.91) per share.

This price represents a substantial 60.1% premium over Biotage’s closing share price on April 17, just days before the announcement.

Following the news, Biotage’s shares, which are listed on the Stockholm stock exchange, surged by 36% at the market’s opening on April 22.

 The company’s market capitalization now stands at around US$1.2 billion.

After a thorough evaluation, Biotage’s board of directors has unanimously recommended that shareholders accept KKR’s offer, citing the attractive premium and the potential for future growth under private ownership.

KKR already holds a 17% stake in Biotage through its life sciences platform, Gamma Biosciences, and would gain full control if the deal proceeds.

 The acquisition is part of KKR’s broader strategy to expand its presence in the healthcare and life sciences sectors.

Earlier in April, KKR agreed to acquire another Stockholm-based company, Karo Healthcare, for €2.6 billion (US$3 billion), demonstrating the firm’s ongoing commitment to the sector despite a generally sluggish market for mergers and acquisitions involving US equity.

Biotage is known for developing products used in drug discovery and development, such as synthesisers, purification systems, and evaporators.

The company also supplies tools for clinical testing, bioanalysis, and toxicology, serving a global client base in over 80 countries.

However, Biotage has faced challenges recently; its interim Q1 report, released on the same day as the takeover bid, revealed a sales decline of nearly 20% compared to the previous year.

This downturn has been attributed to volatility in the bioprocessing market, a trend that has affected other major players in the sector as well.

Despite these headwinds, Biotage’s board believes that KKR’s resources and network of industrial advisers could accelerate the company’s growth in a private setting.

The board also acknowledged that while there may be additional value in Biotage that is not fully captured by the offer, there are risks and short-term volatility associated with the remaining public.

The deal is subject to regulatory approvals and requires KKR to secure over 90% of Biotage’s shares to proceed with a compulsory buyout of remaining shareholders.

With strong institutional support and a fully financed bid, KKR’s proposal is positioned as a compelling opportunity for Biotage’s investors.

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