Animalcare Group PLC, a U.K.-listed pharmaceutical company, announced Tuesday that its Australian subsidiary, Animalcare Australia Pty Ltd., has entered into a conditional share purchase agreement to acquire Randlab, a leading Australian equine veterinary business, for 120 million Australian dollars ($79 million). This acquisition is part of Animalcare's strategy to broaden its product portfolio and strengthen its global market presence.

Strategic Acquisition in the Equine Market
Randlab, a prominent player in the Australian equine healthcare sector, produces a range of prescription and over-the-counter veterinary products for horses, including antibiotics, sedatives, and anesthetics. The company generates approximately 85% of its total sales through its main trading entity, Randlab Pty Ltd., with additional revenue from its New Zealand subsidiary and a small presence in the UAE.

Jenny Winter, CEO of Animalcare Group, expressed enthusiasm about the acquisition, highlighting Randlab's position as a market leader in the growing equine sector. "Not only will this acquisition elevate the group's offering in the equine market, but it will also open up broader opportunities in a commercially and regulatorily-aligned business environment," Winter said.

Financial Details and Funding Plan
Animalcare plans to finance the acquisition through a mix of its own cash reserves, committed debt facilities, and proceeds from a share placing. The company has launched an accelerated bookbuild process for the placing, aiming to raise approximately £20 million ($25 million) through the issuance of up to 8.5 million new shares at a price of 232.5 pence each. The deal is expected to close in early January, contingent on Randlab's performance for the five months ending in November.

Growing Market for Equine Healthcare
The global equine healthcare market is estimated to be valued at $3.4 billion in 2023, with a projected compound annual growth rate of 8.32% from 2024 to 2030, according to Grand View Research. Factors such as research and development initiatives, increasing equine health complications, and the integration of artificial intelligence in equine health are driving the growth in this sector.

Advisors Involved in the Transaction
Squire Patton Boggs LLP is advising Animalcare on the acquisition, with teams in both Sydney and the U.K. assisting with the deal and the proposed share placing. Animalcare's financial and tax advisers on the transaction include Pitcher Partners, an association of Australian accounting firms. Counsel information for Randlab was not immediately available.

Recent Developments and Strategic Moves
This acquisition follows Animalcare's February sale of its majority stake in pet microchipping company Identicare Ltd. for £24.9 million ($31.5 million). The company’s focus on expanding its equine portfolio and global footprint underscores its commitment to growing its presence in the expanding animal healthcare market.