Disposal

RNS Number : 9251B

Sareum Holdings PLC

26 August 2008

 



26 August 2008

Sareum Holdings plc ("Sareum" or "the Company")

Disposal of Assets

Further to recent announcements regarding its future, Sareum Holdings plc (AIM: SAR), the specialist structure-based drug discovery business, is pleased to announce the successful disposal of substantially all of the equipment assets of Sareum Limited, its wholly owned subsidiary, including its Crystal Bank and fragment screening library, for cash considerations totalling £720,000. The Directors of the Company believe that the disposal is in the best interests of the Company and the shareholders as a whole.

The most substantial agreement is with Galapagos NV for sale of the structure-based drug discovery service business for a cash consideration of £553,000. Under the terms of this agreement, Galapagos NV has acquired equipment assets and Sareum's ongoing service contracts. A team of five Sareum employees will also be joining Galapagos' service division BioFocus DPI. The text of Galapagos NV's press release, also issued today, is appended below. 

For the year ended 30 June 2007 the loss before taxation attributed to Sareum Limited was £605,938 and the value of the equipment assets at 31 December 2007 was approximately £588,000. Of this amount approximately £377,000 related to assets that were subject to lease agreements. Of the total consideration of £720,000, approximately £203,000 has been used to terminate these agreements.

The directors believe that if this disposal had not been completed, Sareum Limited would have been unable to meet its financial commitments as they fell due and consequently would have been unable to continue trading resulting in the appointment of liquidators or administrators.

The Company has retained the intellectual property of its cancer drug discovery programmes which it plans to develop using the proceeds of the disposal. The Company's shares will remain suspended while it completes its re-organisation and finalises its financial and business strategy. Further announcements are expected to follow shortly.

Contacts:

Sareum Holdings plc	01223 497700
Tim Mitchell, Chief Executive Officer
Buchanan Communications	020 7466 5000
Tim Anderson, Mary-Jane Johnson
Grant Thornton UK LLP	020 7383 5100
Philip Secrett, Colin Aaronson

Text of the Galapagos NV press release:

Galapagos acquires structure-based drug discovery from Sareum

Mechelen, Belgium and Cambridge, UK; 26 August 2008 - Galapagos NV (Euronext: GLPG) and Sareum Holdings plc (AIM: SAR) announce today that Galapagos has acquired Sareum's assets in drug discovery services, for a total cash consideration of €695,000 (£553,000). These assets will position Galapagos' service division BioFocus DPI strongly in the growing field of structure-based drug discovery.

A key step in drug discovery research is the identification of small molecules that bind to a drug target. In structure-based drug design, the three-dimensional structure of a drug target is used to guide the discovery of such small molecules. It is a rapidly growing segment of the drug discovery market, having generated molecules for approved drugs and numerous candidate drugs in clinical development. Sareum's structure-based approach specifically makes use of x-ray crystallography to discover chemical fragments for recombination into lead compounds. This approach has proven to accelerate drug discovery in many programs, both in its internal R&D and in services contracts with top pharma clients.

Under the agreement, Galapagos has acquired all of Sareum's ongoing services contracts relating to structure-based drug discovery, the Crystal Bank (a set of protein target structures), a fragment screening library and the specialized equipment needed to perform structure-based drug discovery. This technology fits very well and will be incorporated within BioFocus DPI's capabilities in screening and medicinal chemistry, and will complement its services offering. A team of five Sareum employees will join BioFocus DPI (Chesterford Park, Saffron Walden, UK) and continue to operate the platform, securing a smooth transition of the business.

"We are pleased to have acquired Sareum's structure-based drug discovery assets and welcome their team and their clients to BioFocus DPI," said Dr Chris Newton, Senior Vice President BioFocus DPI. "The assets and expertise acquired from Sareum strengthen our drug discovery, adding a novel technology that our customers are expressing interest in. We look forward to extending and expanding this business within the BioFocus DPI client base."

"I am confident that the acquisition of Sareum's expertise in structure-based drug discovery services will further enhance BioFocus DPI's leading position in global drug discovery service provision", added Dr Tim Mitchell, CEO, Sareum Holdings plc.

The structure based offering will contribute marginally to BioFocus DPI revenue target for 2008 and Galapagos reiterates it full year guidance of revenues between €75-80 million and a year-end cash of around €25 million.

About structure-based drug discovery

Structure-based drug discovery has been in use within the pharmaceutical industry for over twenty-five years. It plays an important role in drug discovery, design and optimization. The technology relies on knowledge of the three-dimensional structure of drug targets. Once the structure is known, potential drugs are designed to 'lock-in' to the drug target, facilitating the development of high-quality drug candidates.

About Sareum

Sareum Holdings plc is a structure-based drug discovery business headquartered in Cambridge, UK. The Company was formed in August 2003 to discover new drugs for the treatment of cancer. Sareum's unique approach aims to halve the time it takes to discover new drug candidates. Sareum's approach to structure determination utilises its proprietary protein expression platform in order to produce multiple recombinant proteins that accelerate structure determination. Sareum aims to successfully deliver drug candidates for licensing to larger pharmaceutical companies at the pre-clinical or early clinical trials stage. Sareum joined the AIM market of the London Stock Exchange in October 2004 under the symbol SAR. For further information, please visit www.sareum.co.uk

About Galapagos and BioFocus DPI

Galapagos (Euronext Brussels: GLPG; Euronext Amsterdam: GLPGA; OTC: GLPYY) is a drug discovery company with pre-clinical programs in bone and joint diseases and bone metastasis. Its division BioFocus DPI offers a full suite of target-to-drug discovery products and services to pharmaceutical and biotech companies, encompassing target discovery and validation, screening and drug discovery through to delivery of pre-clinical candidates. BioFocus DPI also provides adenoviral reagents for rapid identification and validation of novel drug targets, compound libraries for drug screening as well as ADMET products to select compounds. Galapagos currently employs 500 people and operates facilities in six countries, with global headquarters in Mechelen, Belgium. More information about Galapagos and BioFocus DPI can be found at www.glpg.com and www.biofocusdpi.com.

CONTACTS:

Galapagos NV

Onno van de Stolpe, CEO                    [phone]

[e-mail]

Sareum Holdings plc	[phone]
Tim Mitchell, Chief Executive Officer
Buchanan Communications	[phone]
Tim Anderson, Mary-Jane Johnson
Grant Thornton UK LLP	[phone]
Philip Secrett, Colin Aaronson

This release may contain forward-looking statements, including, without limitation, statements containing the words "believes," "anticipates," "expects," "intends," "plans," "seeks," "estimates," "may," "will," "could," "stands to," and "continues," as well as similar expressions. Such forward-looking statements may involve known and unknown risks, uncertainties and other factors which might cause the actual results, financial condition, performance or achievements of Galapagos, or industry results, to be materially different from any historic or future results, financial conditions, performance or achievements expressed or implied by such forward-looking statements. Given these uncertainties, the reader is advised not to place any undue reliance on such forward-looking statements. These forward-looking statements speak only as of the date of publication of this document. Galapagos expressly disclaims any obligation to update any such forward-looking statements in this document to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based, unless required by law or regulation.

 

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