Poland-based Selvita (WSE: SLV), a clinical stage company engaged in the research and development of novel cancer therapies as well as provision of drug discovery and development services, today announced that it plans to separate into two companies.
News of the decision sent shares of Selvita, Poland largest biotech company, up as much as 5.5%, before settling for a 3.95% rise to 60.50 zloty by close.
One company will focus on development of small molecule therapeutics in oncology and the other will provide contract research services. Each company will build upon capabilities that have been integral to the Company since the founding of Selvita in 2007. Both companies will be publicly listed on the Warsaw Stock Exchange.
The transaction is expected to be completed by the fourth quarter of 2019, subject to approvals by Selvita shareholders and the Polish Financial Supervisory Authority.
Opportunities for value creation
“There are clear opportunities for value creation from two entities with freedom to operate independently, built from the separate business units of Selvita today,” commented Pawel Przewiezlikowski, chief executive of Selvita. “We are proud of the work that has brought us to the stage where each unit is at the forefront of an area of expertise. Our capabilities in each unit provide excellent potential for sustainable, long-term growth. We look forward to the increased overall value from each distinct company, building upon an established tradition of operational excellence,” he added.
The oncology therapeutics company will control the current Selvita pipeline of small molecules and its engine for consistent discovery of differentiated compounds in oncology. Following the split, the Selvita oncology therapeutics company will advance SEL120 and other early stage programs from three current discovery platforms: Targeted Therapeutics, Cancer Metabolism/Immunometabolism and Immuno-oncology platforms.
The research services company will pursue further dynamic organic growth and expand its business model with acquisitions of high value complementary biopharmaceutical service providers. The research services company will retain the Selvita name and the oncology therapeutics company will be named at a later date.
At the time of the split, around 170 individuals or full-time equivalent employees are expected to become part of the therapeutics business and the research services company will employ about 325 people.