Rosetta Capital buys SEK220 million share in Karolinska Development holdings

20 December 2012

Karolinska Development AB has announced that a syndicate led by the life science investor Rosetta Capital will acquire a minority share in Karolinska Development’s holdings in 13 of its 25 portfolio companies for SEK 220 million.

Karolinska Development will transfer 13 of its portfolio company holdings to a new private holding company called KDev Investments AB. The KDev Investments portfolio will include both early and clinical stage pharmaceutical assets as well as some technology assets. Rosetta will acquire 7.33% of the common shares in KDev Investments AB for SEK 110 million and preference shares in KDev Investments AB for a further SEK 110 million.

The investment gives a total value of the KDev Investments portfolio of approximately SEK 1,500 million, about two times Karolinska Development’s investment in the same portfolio and a 23% premium to the reported fair value. After the transaction, Karolinska Development’s cash and short-term investments will be approximately SEK 500 million.

Torbjörn Bjerke, CEO of Karolinska Development: “This deal shows the value that Karolinska Development has created in recent years. Our financial position is significantly strengthened and this will enhance our ability to build further value in both KDev Investments as well as the rest of our portfolio, by taking products onwards to the point where we can secure partnerships with pharmaceutical companies as well as trade sales of portfolio companies.”

Karolinska Development’s pro forma net asset value (NAV) which reflects the transaction with Rosetta, but is otherwise in accordance with the reported NAV as of September 30, 2012, amounts to SEK 46.3 per share, compared to SEK 40.4 prior to the transaction.

Mr. Donald Macpherson, Chairman of Rosetta Capital Limited, said, “We are delighted to be investing in the Karolinska Development portfolio and are extremely impressed by the quality of the underlying science and the commercial opportunities. We look forward to significant investment returns for all stakeholders, and the development of new and innovative medical treatments for the benefit of society as a whole. Our team is delighted to have the opportunity work actively alongside the Karolinska Development team.”


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