Point of care diagnostics business EKF has accompanied its full-year results with a share placing, an acquisition and a distribution agreement in North American and UK markets. The news should help reinvigorate the shares, which remain a buy.
EKF is raising £13m at 20p a share towards the $25.5m (£15.8m) cash and shares acquisition of Stanbio Laboratory, a distributor and manufacturer with an existing relationship with EKF. Contingent on the Stanbio acquisition, EKF will sign a distribution agreement with US distributor Alere for the exclusive rights to distribute EKF’s Hemo-Control haemoglobin measurement kit in North America and the UK. This fills a gap in EKF’s business, which was previously under-represented in North America.
Meanwhile, the EKF business itself has performed well. In the first quarter of 2011, revenues were 28 per cent ahead of the same period last year.
What we said: Buy
Price: 27.5p
When: 18 Feb 2011
Performance to date: -16%
